S&P puts Diamond Resorts on positive watch

S&P said it placed all its Diamond Resorts International Inc.’s ratings, including the CCC- ratings on its notes, on CreditWatch with positive implications.

Hilton Grand Vacations Inc., rated BB, plans to acquire Diamond in a deal that values its equity at $1.4 billion. Hilton will also repay or refinance Diamond’s debt.

“We believe Diamond’s credit profile will be improved through its acquisition by a higher-rated entity,” S&P said in a press release.

The agency said it plans to resolve the CreditWatch over the next several months after reviewing additional disclosures regarding the financing plan, updating its leverage forecast to incorporate the acquisition’s effect, and assessing business risks and opportunities for the combined entity.

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