S&P rates First Data notes B+

Standard & Poor's said it assigned its B+ issue-level rating to First Data Corp.'s proposed $3.2 billion term loan D due 2017 and $850 million first-lien notes due 2019. The recovery rating is 2, reflecting an expectation of substantial recovery for term loan lenders in the event of default.

In addition, the agency said it affirmed the B corporate credit rating. The outlook is stable.

S&P said the ratings reflect First Data's highly leveraged capital structure, weak credit protection measures and modest free cash flow generation. Nevertheless, with segment revenues of about $6.6 billion for 2011, First Data retains a "strong" business risk profile, the agency said.

"We expect First Data to offset highly competitive industry conditions and pricing pressure through its ongoing cost-reduction initiatives and growth-driven economies of scale," said S&P credit analyst John Moore in a news release.

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