S&P gives Weight Watchers notes CCC+

S&P said it assigned a CCC+ issue-level rating to Weight Watchers International Inc.'s proposed $500 million senior unsecured notes due 2025.

The recovery rating is 6, indicating an expectation of negligible (0%-10%, rounded estimate: 5%) recovery in the event of a payment default.

The company intends to use the proceeds from this issuance and the previously announced $150 million revolving credit facility and $1.39 billion of first-lien term loan due to refinance its existing $2.1 billion term loan B due 2020 and its $50 million revolving facility due 2018.

S&P said the offering will be leverage neutral, and it expects that the company will end 2017 with leverage around 6x and declining to mid 5x by the end of 2018 because of another successful winter recruiting season and continued improving membership retention rates.

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