S&P rates Scientific Games notes B+, B-

S&P said it assigned its B+ issue-level rating and 2 recovery rating to Scientific Games Corp.'s proposed €325 million senior secured notes due 2026. The 2 recovery rating reflects an expectation for substantial recovery (70% to 90%; rounded estimate: 80%) for lenders in the event of a payment default.

S&P also assigned a B- issue-level rating and 5 recovery rating to the company's proposed €250 million senior unsecured notes due 2026. The 5 recovery rating reflects an expectation for modest (10% to 30%; rounded estimate: 10%) for lenders in the event of a payment default.

The issue-level and recovery ratings on the company's existing $850 million 5% senior secured notes due 2025 (pro forma for the $500 million add-on) remain B+ and 2, respectively.

The proposed notes will be issued by Scientific Games' direct subsidiary, Scientific Games International Inc. Scientific Games plans to use proceeds from the proposed notes, along with a previously announced $3.8 billion term loan B-5, and a $500 million add-on to the company's existing 5% senior secured notes due 2025, to refinance its existing term loan B-4, repay a portion of its balances under its revolver, and repay $1.4 billion of principal under the company's existing $2.1 billion 7% senior secured notes due 2022.

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