S&P rates Affinion loans B, CCC

Standard & Poor's said it assigned Affinion Group Holdings Inc.'s outstanding $775 million senior secured first-lien term loan B due 2018 its B issue-level rating with a recovery rating of 1, indicating an expectation for very high (90% to 100%) recovery for secured lenders in the event of a payment default.

Additionally, the agency assigned the company's $425 million senior secured second-lien term loan B due 2018 its CCC issue-level rating with a recovery rating of 5, indicating an expectation for modest (10% to 30%) recovery for secured lenders in the event of a payment default.

S&P said the CC corporate credit rating and negative outlook reflect its expectation that if the company completes the pending exchange transaction, the agency would view it as distressed and tantamount to a default, given Affinion Group Holdings' large and, in S&P's view, unsustainable debt burden.

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