S&P affirms Choice Hotels

S&P said it affirmed its BB+ corporate credit rating on Choice Hotels International Inc., following the company's announcement that it has entered into an agreement to purchase the brands, franchise agreements and marketing and franchise development business of extended-stay lodging company WoodSpring Hotels for $231 million.

The company intends to fund the purchase using borrowings under its existing revolving credit facility.

The outlook is stable.

S&P said the BB+ corporate credit rating affirmation reflects S&P’s expectation that Choice will sustain S&P’s measure of lease-adjusted debt to EBITDA in the low-3x area and funds from operations (FFO) to debt in the high-teens percentage area through 2019.

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