S&P assigns BB- to H&E notes

S&P said it assigned its BB- issue-level rating and 3 recovery rating to H&E Equipment Services Inc.'s proposed $750 million senior unsecured notes due 2025. The 3 recovery rating indicates an expectation for meaningful (50%-70%; rounded estimate: 55%) recovery in a default scenario.

The company plans to use the proceeds to redeem its existing $630 million senior unsecured notes due 2022, repay a portion of the outstanding debt under its asset-based lending facility and for general corporate purposes.

The agency also affirmed its BB- issue-level rating on the company's existing $630 million senior unsecured notes and removed the rating from CreditWatch, where it was placed with negative implications on July 17, following the company's announcement that it planned to acquire Neff Corp. The 3 recovery rating is unchanged, indicating an expectation for meaningful (50%-70%; rounded estimate: 55%) recovery in a default scenario.

“We removed the rating from CreditWatch because we no longer expect the company's previously announced merger with Neff (which could have lowered the recovery prospects for the notes under the company's proposed acquisition capital structure) to be completed,” S&P said in a news release.

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