Moody's assigns Sonic Automotive notes B3

Moody's Investors Service said it assigned a B3 rating to Sonic Automotive, Inc.'s proposed $200 million senior subordinated notes due 2022.

The agency said it also affirmed the company's B1 corporate family and probability of default ratings. The outlook is stable.

Moody's said the B3 rating on the proposed senior subordinated notes largely reflects the instruments' legal subordination to the company's $175 million ABL facility and syndicated floor plan facility and first lien mortgage notes related to its dealership properties.

The agency said the affirmation of Sonic's B1 corporate family rating considers that the proposed transaction will eliminate the risk of the senior unsecured convertible notes due 2029 being put back to Sonic in October 2014.

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