S&P rates Gogo notes B-

S&P said it assigned a B- rating and 3 recovery rating to Gogo Inc.'s proposed senior secured notes due 2022.

The 3 recovery rating indicates 50% to 70% expected default recovery.

We previously rated the proposed notes, but withdrew the ratings following news that the company no longer intends to proceed with the notes offering at that time.

The structure of the notes is unchanged.

The notes, issued by Gogo Intermediate Holdings LLC and Gogo Finance Co. Inc., will be guaranteed by Gogo Inc. and each of Gogo Inc.'s and Gogo Intermediate Holdings LLC's domestic subsidiaries and secured by first-priority security interests in substantially all assets, S&P said.

The proceeds from the proposed senior secured notes will be used to refinance the company's existing senior credit facilities and fund organic growth, the agency said.

The CCC rating and 6 recovery rating on Gogo's existing convertible notes also are unchanged. The 6 recovery rating indicates 0 to 10% expected default recovery.

The B- corporate credit rating and negative outlook on Gogo also are unchanged.

The negative outlook reflects risks concerning international growth plans and an expectation that ongoing capital expenditures will diminish the company's current cash balance, S&P said.

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