S&P rates Equinix notes BB+

S&P said it affirmed all of the ratings on Equinix Inc., including the BB+ corporate credit rating.

The outlook is stable.

The agency also said it assigned a BB+ rating and 3 recovery rating to the company's proposed $1.125 billion unsecured notes with an anticipated maturity of 10 years.

The 3 recovery rating indicates 50% to 70% expected default recovery.

The ratings follow news that the company will use a balanced mix of debt and equity to fund the $3.6 billion acquisition of 29 data centers from Verizon, resulting in adjusted debt-to-EBITDA ratio that will be consistent with expectations in the mid-4x range in 2017, S&P said.

The stable outlook reflects an expectation that debt-to-EBITDA ratio will remain in the mid-4x range in 2017, improving to the low-4x area in 2018 as higher debt to fund capital investments, acquisitions and dividend distributions largely offset earnings growth, the agency said.

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