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S&P rates Loyalty Ventures loan BB-
S&P said it assigned its B+ issuer credit rating to Loyalty Ventures Inc.
At the same time, S&P assigned its BB- issue-level rating and 2 recovery rating to the company's senior secured term loan B. The 2 recovery rating reflects an expectation for substantial (70%-90%; rounded estimate: 70%) recovery in the event of default.
The outlook is stable.
Loyalty Ventures is proposing to issue a $175 million term loan A and a $500 million term loan B. The company will use the proceeds of the term loan, along with cash on hand, to pay $750 million in dividends to Loyalty Ventures' parent company, Alliance Data Systems Corp. The company is also proposing to issue an up to $125 million revolver, which is expected to be undrawn at close.
“The stable outlook reflects our expectation that Loyalty Ventures will improve its adjusted debt to EBITDA aided by recovery in EBITDA of the company's BrandLoyalty segment,” S&P said in a news release.
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