S&P ups Dollar Thrifty

Standard & Poor's said it raised the corporate credit rating on Dollar Thrifty Automotive Group Inc. to B from B-, based on the company's improved operating and financial performance.

The agency also said it raised the rating on the company's senior secured credit facility.

The ratings remain on CreditWatch, where they were initially placed with positive implications in April when competitor Hertz Global announced it had signed a definitive agreement to acquire Dollar Thrifty. Dollar Thrifty's shareholders voted against that bid in September.

Higher-rated competitor Avis Budget now appears to be the likely acquirer of Dollar Thrifty, pending regulatory approval expected in early 2011.

The ratings upgrade reflects Dollar Thrifty's improved operating and financial performance, which is expected to be sustained, whether or not the company is acquired by Avis Budget, the agency said.

The company's operating performance has benefited from stronger demand, higher prices and substantial cost reductions, S&P said.

The ratings also consider its aggressive financial profile and small market share, the agency said, and the price-competitive and cyclical nature of on-airport car and equipment rentals.

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