Moody’s Cuts Ratings for United Site Services

Moody’s Investors Service has cut the corporate family rating of United Site Services Inc. to B1 from Ba3, downgraded its first lien revolving credit facility to B1 from Ba3 and downgraded its second lien term loan to Caa1 from B3. USS is a Westborough, Mass.-based renter of on-site event services like portable restrooms, temporary fencing. It has been owned by DLJ Merchant Banking Partners since 2006.


Moody’s Investors Service downgraded the corporate family rating of United Site Services, Inc. (“USS”) to Caa1 from B3. Moody’s also downgraded the first lien revolving credit facility to B1 from Ba3 and the second lien term loan to Caa1 from B3. The downgrade reflects the company’s weak credit metrics, the potential for ongoing weak cash flows, and the prospects for a more severe economic downturn than the prior rating anticipated. The downgrade also reflects Moody’s concern that a protracted downturn in the residential/commercial construction market may continue to pressure the company’s operating performance. Notwithstanding the benefit of disaster related activity on the company’s September 2008 results, Moody’s remains concerned that sales in the company’s core construction-related business could remain under pressure. The rating derives support from the company’s adequate liquidity, its favorable operating performance for the September 2008 quarter, and its ongoing cost reduction activities. The ratings outlook remains negative.

The following ratings were downgraded:

Corporate Family Rating to Caa1 from B3;

Probability of Default Rating to Caa1 from B3;

$100 million senior secured first lien revolving credit facility due 2012 to B1 (LGD1, 6%) from Ba3 (LGD1, 5%);

$265 million senior secured second lien term loan due 2013 to Caa1 (LGD3, 47%) from B3 (LGD3, 45%).

The negative outlook reflects Moody’s concern over the company’s ability to improve its earnings and cash flows given the prospects for a protracted downturn in its construction end-markets.

For further detail, refer to Moody’s credit opinion for United Site Services, Inc.

The last rating action for USS occurred on September 25, 2007, when Moody’s downgraded the corporate family rating to B3 from B2 and revised the ratings outlook to negative from stable.

Moody’s analyzes this company using the Global Consumer & Business Service Industry Methodology.

United Site Services, Inc. headquartered in Westborough, MA, rents and services a comprehensive line of portable restrooms, temporary fencing, temporary electric equipment and storage containers to a broad range of customers including construction contractors, special events planners, private individuals, commercial establishments and governmental agencies. The company is privately held.