S&P rates Avis notes BB-

S&P said it rated Avis Budget Car Rental LLC's and Avis Budget Finance Inc.'s proposed $400 million senior secured notes due 2025 at BB- with a 2 recovery rating.

The notes will be guaranteed by parent Avis Budget Group Inc. The 2 recovery rating indicates an expectation that lenders would receive substantial (70%-90%; rounded estimate: 70%) recovery in the event of a payment default.

Avis Budget will use the proceeds for general corporate purposes.

“At the same time, we are revising our rounded recovery estimate on the company's existing rated secured debt to 70% from 85% to reflect the increased amount of secured debt in its capital structure,” S&P said in a press release.

Avis placed the new notes’ rating on CreditWatch with negative implications along with Avis Budget’s other ratings. S&P placed the ratings on CreditWatch on March 16.

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