S&P rates Bankrate notes B

Standard & Poor's said it assigned a B corporate credit rating to Bankrate Inc., along with a B rating on the company's $300 million senior secured notes due 2015, with a recovery rating of 4, indicating an expectation in 30% to 50% recovery in a default.

The outlook is stable.

The company plans to use proceeds from the proposed notes to acquire NetQuote and CreditCards.com for $205 million and $145 million, respectively.

The rating reflects Bankrate's high debt balances following the transactions, sizable potential litigation settlements, the company's acquisitive growth strategy, highly competitive online financial information marketplace and vulnerability to economic activity and interest rate fluctuations that drive site traffic and ad rates, S&P said.

The company's leading position as a compiler of financial product information and rate tables, its healthy conversion of EBITDA to discretionary cash flow and its editorial capabilities and co-branding relationships are positives that do not fully offset these risks, the agency said.

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