Brinks acquired Maco of Argentina for $209 million and it is in the process of acquiring Temis of France for $71 million.


  • The Brink's Co. has recently completed a large acquisition and is in the process of completing a second, both of which are primarily debt-financed, and we expect weaker credit metrics to result.
  • Therefore, we are lowering our corporate credit rating on Brink's to 'BB+' from 'BBB-' and removing all of the ratings from CreditWatch, where they were placed with negative implications on July 14, 2017.
  • At the same time, we are lowering our issue-level rating on the company's $525 million revolving credit facility to 'BB+' from 'BBB-' and assigning a '3' recovery rating.
  • We are also assigning a 'BB' issue-level rating to the company's proposed $500 million senior unsecured notes issuance, with a recovery rating of '5', based on the company's proposed capital structure.
  • The stable outlook reflects our belief that the company's credit metrics will remain relatively consistent over the next 12-18 months, with funds from operations to debt in the mid-to-high 20% area.
Brinks acquired Maco of Argentina for approximately $209 million in July 2017, 
and it is in the process of acquiring Temis of France for approximately $71 
million. Both of the acquisitions were primarily debt-financed. While both 
will bolster the company's revenue and earnings, this will be more than offset 
by the incremental debt, which will result in weaker credit metrics. We expect 
the company's adjusted funds from operations (FFO)-to-debt ratio to decline to 
about 26% at the end of 2017 from an already stretched 30.2% as of June 30, 
2017, and to remain relatively consistent through 2018. The company also has 
off-balance-sheet liabilities, including operating leases, that we treat as 
debt.

The outlook is stable. Over the next year, we expect Brink's credit metrics to 
remain relatively consistent, with incremental debt from previously announced 
and potential acquisitions offsetting increased revenues and earnings. We 
expect the company's FFO to debt to remain in the mid-high 20% area and debt 
to EBITDA in the high 2x area through 2018.