Fitch: Grupo Posadas notes B+

Fitch Ratings said it assigned a B+ rating with RR3 recovery rating to the proposed senior notes for up to $350 million due in the range of seven- to 10-years to be issued by Grupo Posadas, SAB de CV.

The RR3 recovery rating indicates 51% to 70% expected default recovery.

The proceeds will be used to refinance all or part of the notes due 2017, as well as the commercial-paper issuance due November 2015, Fitch said.

The ratings are supported by the company’s solid business position as a leading hotel chain in Mexico, strong brand equity and operating performance, as well as its multiple hotel formats, the agency said.

The ratings are tempered by high leverage, Fitch said, as well as industry cyclicality.

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