S&P rates CCF Holdings notes CCC-

S&P said it assigned a CCC+ long-term issuer credit rating to CCF Holdings LLC. The outlook is negative.

At the same time, S&P assigned a CCC- rating on the company's new pay-in-kind notes due 2023. The recovery rating is 6, indicating an expectation for negligible (0%) recovery in the event of default.

S&P also raised the issue-level rating on the senior secured notes due 2023 issued by Community Choice Financial Issuer LLC to CCC+ from D. The recovery rating is 3, indicating an expectation for meaningful (65%) recovery in the event of default.

S&P said it withdrew its D issuer credit rating on Community Choice Financial Inc. at the issuer's request, as well as the issue-level ratings on its existing senior secured notes.

The rating action follows the formation of CCF following the default of senior secured notes issued by Community Choice Financial Inc. The new holding company is issuing $276.9 million 10¾% senior unsecured pay-in-kind notes due December 2023 to satisfy the previous $260 million senior secured notes due in 2019 and 2020, as well as accrued interest.

“As the new PIK notes do not require interest payments, we expect the transaction will significantly reduce its debt service requirements in the near-term,” S&P said in a news release.

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