S&P: Lottomatica notes BBB-

Standard & Poor's said it assigned a BBB- rating to Lottomatica Group SpA's proposed €500 million senior unsecured notes.

The proceeds will be used to repay existing debt and for general corporate purposes.

While the transaction will temporarily increase leverage, the agency said it does not believe all the funds will be used to immediately repay debt. S&P said it believes the proceeds will provide the company additional flexibility to invest in strategic growth opportunities or repay additional debt in the future if opportunities do not materialize.

The BBB- corporate credit rating on Lottomatica remains unchanged.

The outlook is positive.

The ratings reflect the company's satisfactory business risk profile and intermediate financial risk profile, S&P said.

The ratings also consider its position as one of the world's largest lottery operators, well-established relationships with lottery authorities worldwide and the high barriers to entry for competitors, the agency said.

Somewhat offsetting these factors are the mature, capital-intense nature of the worldwide online lottery business, intense pricing pressure and the potential for large upfront payments to renew key licenses, S&P said.

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