Confie Seguros Holding II Co.: Update Following Recent Downgrade to Caa1 - Moody's Global Credit Research

Confie Seguros Holding II Co.: Update Following Recent Downgrade to Caa1

Confie Seguros Holding II Co.: Update Following Recent Downgrade to Caa1 - Moody's Global Credit Research
Confie Seguros Holding II Co.: Update Following Recent Downgrade to Caa1
Published May 15, 2017
8 pages (3991 words) — Published May 15, 2017
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Brief Excerpt:

...We downgraded the corporate family rating (CFR) of Confie Seguros Holding II Co. (Confie) to Caa1 from B3 in May 2017 based on the company's unexpected slowdown in performance in 2016 with declining EBITDA margins, along with its recent announcement that it will delay publishing its 2016 audited financial statements and restate certain figures for 2015. We also downgraded Confie's probability of default rating to Caa1-PD from B3-PD, its first-lien senior secured credit facility ratings to B3 from B2, and its second-lien term loan to Caa3 from Caa2. The rating outlook for Confie is stable. Confie has experienced declining business volumes in portions of its retail, general agency and service operations during the past year, partly offset by cost saving initiatives. The weaker than expected earnings have pushed the company's pro forma debt-to-EBITDA ratio above 8x, per Moody's estimates, which include standard accounting adjustments. Since being purchased by ABRY Partners in 2012, Confie...

  
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Credit Opinion

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Confie Seguros Holding II Co.
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Confie Seguros Holding II Co.: Update following upgrade, outlook changed to stable - Credit Opinion – 2018/11/01 – US$ 250.00 – ...In October 2018, we upgraded the corporate family rating of Confie Seguros Holding II Co. (Confie) to B3 from Caa1 and the probability of default rating to B3-PD from Caa1-PD based on the company's proposed funding structure, which includes refinancing the company's existing second-lien term loan. We also upgraded Confie's first-lien credit facilities to B2 from B3 and the existing second-lien term loan to Caa2 from Caa3, and assigned a Caa2 rating to the new second-lien term loan. The rating outlook was changed to stable from negative. The ratings upgrade reflects the removal of refinancing risk associated with Confie's credit facilities. The company has also stabilized performance (Exhibit 1). The first-lien term loan and revolver, which mature in April 2022 and October 2021, respectively, currently contain a springing maturity six months prior to the May 2019 maturity of its existing second-lien term loan. Consequently, the first-lien term loan maturity will accelerate to November 8,...

Moody's upgrades Confie Seguros' ratings (corporate family B3), stable outlook - Rating Action – 2018/10/16 – US$ 180.00 – ...MOODY'S CREDIT RATINGS AND MOODY'S PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY'S CREDIT RATINGS OR MOODY'S PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER. ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY'S PRIOR WRITTEN CONSENT. CREDIT RATINGS AND MOODY'S PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT COULD RESULT IN THEM BEING CONSIDERED A BENCHMARK. All information contained...

Confie Seguros Holding II Co.: Update following affirmation, outlook changed to negative - Credit Opinion – 2018/07/11 – US$ 250.00 – ...In June 2018, we affirmed the Caa1 corporate family rating and Caa1-PD probability of default rating of Confie Seguros Holding II Co. (Confie) based on the company's progress in stabilizing revenues and EBITDA. We also affirmed the company's first-lien term loan and revolver ratings at B3 and its second-lien term loan at Caa3. The rating outlook was changed to negative reflecting refinancing risk associated with its credit facilities. Confie's first-lien term loan and revolver, which mature in April 2022 and October 2021, respectively, contain a springing maturity six months prior to the May 2019 maturity of the second-lien term loan. The first-lien term loan maturity will accelerate to November 8, 2018, if the second-lien term loan is not extended or replaced by that date. Confie is exploring strategic alternatives for its capital structure, including a possible refinancing. The success of these initiatives will depend on such factors as Confie's operating performance and the receptiveness...

Moody's affirms Confie Seguros' ratings (corporate family Caa1), changes outlook to negative on refinancing risk - Rating Action – 2018/06/22 – US$ 180.00 – ...MOODY'S CREDIT RATINGS AND MOODY'S PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY'S CREDIT RATINGS OR MOODY'S PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER. ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY'S PRIOR WRITTEN CONSENT. CREDIT RATINGS AND MOODY'S PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT COULD RESULT IN THEM BEING CONSIDERED A BENCHMARK. All information contained...

Confie Seguros Holding II Co.: Semiannual update - Credit Opinion – 2018/02/16 – US$ 250.00 – ...Our credit view of Confie Seguros Holding II Co. (Confie, Caa1 stable) reflects the company's leading position as a broker of non-standard auto insurance to the underserved population. The company markets personal lines insurance through national and regional telesales forces, and more than 780 retail stores, across 19 states with the largest presence in California and Texas, two of the biggest non-standard auto markets in the US. Offsetting these strengths are Confie's elevated financial leverage, weak interest coverage, and negative free cash flow, although the company's metrics improved slightly during 2017 as it executed a plan to remediate operational weaknesses in process and control issues. These issues developed after a period of rapid growth through acquisitions and were largely driven by to two operations in the Southeast. Confie's aggressive acquisition strategy during 2012-16, resulted in the purchase of over 80 companies, mostly modest-sized personal lines brokers and larger...

Moody's downgrades Confie Seguros Holding II Co. corporate family rating to Caa1; outlook stable - Rating Action – 2017/05/04 – US$ 180.00 – ...MOODY'S CREDIT RATINGS AND MOODY'S PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY'S CREDIT RATINGS OR MOODY'S PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER. ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY'S PRIOR WRITTEN CONSENT. All information contained herein is obtained by MOODY'S from sources believed by it to be accurate and reliable. Because of the possibility of human or mechanical error as well as other factors, however, all information contained herein is provided "AS...

Confie Seguros Holding II Co.: Update Following Recent Affirmation at B3 Stable - Credit Opinion – 2016/10/17 – US$ 250.00 – ...Confie Seguros Holding II Co. (Confie - corporate family rating (CFR) B3, probability of default rating B3-PD, stable), based in Huntington Beach, California, is a leading broker of non-standard auto insurance to the US Hispanic community. The company markets personal lines insurance through more than 700 locations primarily on the West Coast and in the South (mainly Texas), as well as some in the Midwest and Northeast. Confie's ratings reflect the company's leading position in its target market, along with its steady revenue growth and healthy EBITDA margins (Exhibit 1). These strengths are tempered by the company's high financial leverage and modest interest coverage, exacerbated by its active acquisition strategy. Illustrating the challenge of integrating numerous acquisitions, in late 2015, Confie recorded a $38 million non-cash write-down of goodwill and intangible assets associated with the acquisition of Personable Holdings, Inc., suggesting that the profit outlook for this entity...

Moody's affirms Confie Seguros Holding II Co. corporate family rating at B3; rates new credit facilities - Rating Action – 2016/10/12 – US$ 180.00 – ...Rating Action: Moody's affirms Confie Seguros Holding II Co. corporate family rating at B3; rates new credit facilities...

Confie Seguros Holding II Co.: Update Following Recent Affirmation at B3 Stable - Credit Opinion – 2016/09/22 – US$ 250.00 – ...Confie Seguros Holding II Co. (Confie - corporate family rating (CFR) B3, probability of default rating B3-PD, stable), based in Huntington Beach, California, is a leading broker of non-standard auto insurance to the US Hispanic community. The company markets personal lines insurance through more than 700 locations primarily on the West Coast and in the South (mainly Texas), as well as some in the Midwest and Northeast. Confie's ratings reflect the company's leading position in its target market, along with its steady revenue growth and healthy EBITDA margins (Exhibit 1). These strengths are tempered by the company's high financial leverage and modest interest coverage, exacerbated by its active acquisition strategy. Illustrating the challenge of integrating numerous acquisitions, in late 2015, Confie recorded a $38 million non-cash write-down of goodwill and intangible assets associated with the acquisition of Personable Holdings, Inc., suggesting that the profit outlook for this entity...

Moody's affirms Confie Seguros Holding II Co. corporate family rating at B3; rates new credit facilities - Rating Action – 2016/09/19 – US$ 180.00 – ...Rating Action: Moody's affirms Confie Seguros Holding II Co. corporate family rating at B3; rates new credit facilities...

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Moody's Global Credit Research—Moody's Investors Service, a leading global credit rating, research and risk analysis firm, publishes credit opinions, research, and ratings on fixed-income securities, issuers of securities and other credit obligations. Credit ratings and research help investors analyze the credit risks associated with fixed-income securities. Ratings also create efficiencies in fixed-income markets and similar obligations, such as insurance and derivatives, by providing reliable, credible, and independent assessments of credit risk. For issuers, Moody's services increase market liquidity and may reduce transaction costs.

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MLA:
Moody's Global Credit Research. "Confie Seguros Holding II Co.: Update Following Recent Downgrade to Caa1" May 15, 2017. Alacra Store. Dec 09, 2018. <http://www.alacrastore.com/moodys-credit-research/Confie-Seguros-Holding-II-Co-Update-Following-Recent-Downgrade-to-Caa1-PBC_1072103>
  
APA:
Moody's Global Credit Research. (). Confie Seguros Holding II Co.: Update Following Recent Downgrade to Caa1 May 15, 2017. New York, NY: Alacra Store. Retrieved Dec 09, 2018 from <http://www.alacrastore.com/moodys-credit-research/Confie-Seguros-Holding-II-Co-Update-Following-Recent-Downgrade-to-Caa1-PBC_1072103>
  
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