Rating Action: Moody's assigns B1 to SiteOne's first lien term loan; outlook is stableGlobal Credit Research - 09 Mar 2021New York, March 09, 2021 -- Moody's Investors Service, ("Moody's") assigned a B1 rating to SiteOne Landscape Supply Holding, LLC's ("SiteOne") $300 million first lien term loan maturing 2028. There is no effect on the company's existing ratings, including the Ba3 Corporate Family Rating (CFR) and Ba3--PD Probability of Default Rating. The outlook is stable.The first lien term loan proceeds will be used to repay the existing first lien term loan maturing in 2024, resulting in a maturity extension of four years and lower interest cost. Given the proposed term loan will be used to refinance a like amount of debt, Moody's views this transaction as credit neutral.The B1 rating assigned to the proposed first lien term loan is one notch lower than the CFR, reflecting its position in the capital structure relative to a meaningfully large ABL revolving credit facility that has a first priority security interest in current assets. The rating on the existing first lien term loan will be withdrawn upon the close of the transaction.Assignments:..Issuer: SiteOne Landscape Supply Holding, LLC....Senior Secured Bank Credit Facility, Assigned B1 (LGD4)RATING RATIONALESiteOne's Ba3 CFR reflects the reoccurring nature of landscape services, low cyclicality of maintenance and repair work, and the company's national presence, breadth of product offerings, and leading position in a fragmented market. The rating also reflects demand fluctuations in residential, commercial, and repair and remodeling end markets and thin operating margins characteristic to distribution businesses. In addition, SiteOne's active acquisition growth strategy may lead to higher debt levels and increased integration risk.The stable outlook reflects our expectations that SiteOne will maintain a good liquidity profile, a conservative financial policy, and adjusted leverage below 3.0x.FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGThe ratings could be downgraded if a more aggressive financial policy is implemented, a fundamental downturn in business conditions results in leverage approaching 4.0x or if liquidity weakens.The ratings could be upgraded if leverage is sustained below 3.0x, free cash flow to debt is maintained above 20%, and the company maintains a good liquidity profile.SiteOne Landscape Supply Holding, LLC, headquartered in Roswell, GA is a national wholesale distributor of landscaping supplies in the US and Canada. The company offers approximately 130,000 SKU's, including irrigation supplies, landscape accessories, fertilizer and nursery products, hardscapes, and maintenance supplies and operates in 180 markets through over 570 branch locations in 45 states in the U.S. and six provinces in Canada. The company's customers include residential and commercial landscape professionals.The principal methodology used in this rating was Distribution & Supply Chain Services Industry published in June 2018 and available at https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_1121974. Alternatively, please see the Rating Methodologies page on www.moodys.com for a copy of this methodology.REGULATORY DISCLOSURESFor further specification of Moody's key rating assumptions and sensitivity analysis, see the sections Methodology Assumptions and Sensitivity to Assumptions in the disclosure form. Moody's Rating Symbols and Definitions can be found at: https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_79004.For ratings issued on a program, series, category/class of debt or security this announcement provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series, category/class of debt, security or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody's rating practices. For ratings issued on a support provider, this announcement provides certain regulatory disclosures in relation to the credit rating action on the support provider and in relation to each particular credit rating action for securities that derive their credit ratings from the support provider's credit rating. For provisional ratings, this announcement provides certain regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.For any affected securities or rated entities receiving direct credit support from the primary entity(ies) of this credit rating action, and whose ratings may change as a result of this credit rating action, the associated regulatory disclosures will be those of the guarantor entity. Exceptions to this approach exist for the following disclosures, if applicable to jurisdiction: Ancillary Services, Disclosure to rated entity, Disclosure from rated entity.The rating has been disclosed to the rated entity or its designated agent (s) and issued with no amendment resulting from that disclosure.This rating is solicited. Please refer to Moody's Policy for Designating and Assigning Unsolicited Credit Ratings available on its website www.moodys.com.Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.Moody's general principles for assessing environmental, social and governance (ESG) risks in our credit analysis can be found at https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_1243406.The Global Scale Credit Rating on this Credit Rating Announcement was issued by one of Moody's affiliates outside the EU and is endorsed by Moody's Deutschland GmbH, An der Welle 5, Frankfurt am Main 60322, Germany, in accordance with Art.4 paragraph 3 of the Regulation (EC) No 1060/2009 on Credit Rating Agencies. Further information on the EU endorsement status and on the Moody's office that issued the credit rating is available on www.moodys.com.The Global Scale Credit Rating on this Credit Rating Announcement was issued by one of Moody's affiliates outside the UK and is endorsed by Moody's Investors Service Limited, One Canada Square, Canary Wharf, London E14 5FA under the law applicable to credit rating agencies in the UK. Further information on the UK endorsement status and on the Moody's office that issued the credit rating is available on www.moodys.com.Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating.Please see the ratings tab on the issuer/entity page on www.moodys.com for additional regulatory disclosures for each credit rating. Scott Manduca Vice President - Senior Analyst Corporate Finance Group Moody's Investors Service, Inc. 250 Greenwich Street New York, NY 10007 U.S.A. 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