S&P lowers LeasePlan, rates Lincoln notes BB+

Standard & Poor's said it lowered the long-term counterparty credit ratings on LeasePlan Corp. NV to BBB- from BBB and its short-term rating to A-3 from A-2.

The agency also said it removed the ratings from CreditWatch, where they were initially placed with negative implications in July.

The downgrade follows news that regulators have approved of LeasePlan's sale to a consortium of investors, funded with a mix of shareholder equity and debt, the agency said.

S&P also said it assigned a BB+ rating to Lincoln Financing Holdings PTE Ltd., the intermediary non-operating holding company of Lincoln Finance Ltd., issuer of the proposed €1.55 billion senior secured notes. The notes were assigned a BB+ rating.

The outlook is stable.

The approved transaction will diminish the creditworthiness of LeasePlan because it will lead to a marked increase in leverage at the consolidated group level, S&P said.

Financial sponsor ownership can lead to further risks related to financial policy and risk appetite, but the downgrade was limited to one notch, the agency said.

LeasePlan is expected to continue to operate largely as an independent, regulated entity, S&P added.

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