Aretec, a subsidiary of Cetera Financial Group, has received an upgrade in its corporate family rating by Moody Investors Service. Aretec received a rating of "B2", which is above competitors like Advisor Group and Kestra Holdings. Despite the upgrade, Cetera technically still is rated "junk," and that is because of its heavy debt load.
According to Financial Planning, the improved rating is based on Aretec's goal to issue a $750 million loan add-on to its existing senior secured bank credit facility to help fund its planned acquisition of the retail wealth business of Securian Financial Group Inc.
Aretec also has improved profitability, increasing scale and the strategic benefits of the acquisition, which offset the initial increase in debt leverage associated with the acquisition.
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