Moodys* has completely withdrawn credit ratings for Houghton Mifflin Harcourt (HMH) after downgrading it to high risk just last month. This action means Moodys believes there is a high probability of default. From a practical standpoint this means that it will be harder and more expensive to service the company’s $6.7 billion in debt on $2.1 billion in revenue.
According to the Irish Times the rationale was:
“the business risk and competitive position of the company versus others within its industry; the capital structure and financial risk of the company; the projected financial and operating performance of the company over the near-to-intermediate term, and management’s track record and tolerance for risk,”