S&P rates Daimler Trucks notes BBB+

S&P said it assigned its preliminary BBB+ long-term issue ratings to Daimler Truck Holding AG’s upcoming senior unsecured notes that will be issued by its two financing subsidiaries, Daimler Trucks Finance Canada Inc. and Daimler Trucks Finance North America LLC.

The notes for the U.S. market are expected to be divided into various tranches either fixed- or floating-rate format. In the Canadian market, Daimler Truck plans to offer notes into tranches, also either fixed- or floating-rate.

The rating is in line with S&P’s preliminary issuer credit ratings on Daimler Truck and wholly owned subsidiary Daimler Truck AG because the level of debt is low, and there are no material elements of subordination in the capital structure, the agency said.

“Daimler Truck Holding AG and Daimler Truck AG will each guarantee the due and punctual payment amounts the issuers will pay on the notes. We also understand that there will be an upstream guarantee from Daimler Truck AG to Daimler Truck Holding AG, to equalize all interests,” S&P said in a press release.

The proceeds will fund the acquisition of the financial service portfolio based in the U.S. and Canada.

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