Global manufacturer of durable medical equipment (DME) Medical Depot Holdings Inc. (also known as Drive DeVilbiss Healthcare) is being acquired by private equity sponsor Clayton, Dubilier&Rice. The company's capital structure will consist of a $417 million senior secured first-lien term loan, a $162 million second-lien term loan, and a $100 million senior secured revolver, pro forma for a near-term tuck-in acquisition. We estimate adjusted debt leverage is about 9.1x for 2016 and 7.3x for 2017. We are assigning a 'B' corporate credit rating to Medical Depot Holdings Inc. The outlook is stable. At the same time, we are assigning a 'B' issue-level rating and a '3' recovery rating to Medical Depot's $417 million first-lien term loan due in
