S&P: Odeon notes B, loan BB-

Standard & Poor's said that it assigned a preliminary B long-term corporate credit ratings to Odeon & UCI Cinemas Group Ltd. and a preliminary B issue rating to the £475 million-equivalent senior secured notes due 2018 to be issued by Odeon & UCI Finco plc. The preliminary recovery rating on these notes is 4, indicating average (30%-50%) recovery.

The outlook is stable.

S&P also assigned a preliminary issue rating of BB- to the £90 million revolving credit facility to be issued by Odeon & UCI Bond Midco Ltd. The preliminary recovery rating is 1, indicating very high (90%-100%) recovery in the event of a payment default.

The ratings on Odeon reflect the company's highly leveraged financial risk profile following its proposed refinancing, the agency said.

The ratings consider that over the coming year Odeon will sustain positive revenue growth while maintaining profitability margins at least in line with previous years, the agency added. The ratings incorporate the assumption that EBITDA will rise to about £105 million in 2011, with further growth projected in 2012.

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