S&P rates Everi loan B+

S&P said it affirmed the B corporate credit rating on Everi Payments Inc.

The outlook is stable.

The agency also said it assigned a B+ rating to Everi's proposed senior secured credit facility, consisting of a $35 million revolver due in 2022 and an $820 million term loan due in 2024.

The recovery rating is 2, indicating 70% to 90% expected default recovery.

The proceeds will be used to refinance the company's existing term loan, repay its $335 million senior secured notes and for transaction fees and expenses, S&P said.

The agency said it plans to withdraw the ratings and recovery ratings on the company's existing senior secured credit facility and senior secured notes once they are fully repaid.

The ratings reflect an expectation for adjusted leverage to remain high in the mid- to high-5x range through 2018, S&P said, but for adjusted EBITDA coverage of interest to remain in the low-2x range.

A leverage of higher than 5x is considered high for Everi since it operates in highly competitive markets, which can lead to price discounting and EBITDA pressure and volatility, the agency explained.

The ratings also consider Everi's relatively small scale and modest competitive disadvantage since it competes with larger operators that have substantially more resources, S&P said.

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