S&P assigns BB to Hanesbrands notes

S&P said it assigned a BB issue rating with a 3 recovery rating to Hanesbrands Finance Luxembourg SCA's issuance of $513 million euro-denominated unsecured notes.

The 3 recovery rating indicates an expectation of meaningful (50% to 70%, at the high end of the range) recovery in the event of a payment default.

Proceeds will partially finance the recently announced acquisitions of Pacific Brands and Champion Europe.

All existing ratings on the company, including the BB corporate credit rating and BB issue-level and 3 recovery rating on existing unsecured obligations, remain unchanged.

The BBB- and 1 issue-level and recovery ratings for the first-lien revolver and term loans are also unchanged, indicating an expectation for very high recovery (90% to 100%).

The outlook is negative.

S&P said the ratings reflect Hanesbrands' solid market positions in the innerwear and athletic apparel segments, operating scale in the highly competitive apparel sector, as well as the commodity-like nature of some of its products.

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