S&P lifts Zayo debt, rates notes B-

Standard & Poor's said it assigned its B- issue-level rating to Zayo Group LLC's proposed $350 million unsecured notes maturing 2025.

The recovery rating on the debt is 5, indicating an expectation for modest (10%-30%; upper half of the range) recovery for lenders in the event of default.

At the same time, the agency raised the issue-level rating on the company's existing senior unsecured debt to B- from CCC+ and revised the recovery rating to 5 from 6. The revision of the unsecured recovery rating reflects both an increase in S&P’s net enterprise value under our hypothetical default scenario and increased residual value for unsecured lenders as a result of lower levels of secured debt.

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