S&P rates Affinity Group notes B-

Standard & Poor's said it assigned Affinity Group Inc.'s proposed $325 million senior secured notes due 2016 a preliminary B- rating and a preliminary recovery rating of 4, indicating expectation of 30% to 50% recovery.

After the issue closes, the agency said it expects to assign a B- corporate credit rating to Affinity Group Inc. and withdraw the D corporate credit rating on Affinity Group Holding Inc.

Proceeds will be used to help repay in $88 million of senior notes that are currently outstanding at Holding.

The expected B- corporate credit rating reflects expectation that, following the proposed refinancing, adjusted debt leverage will be reduced by about 1x, the company will not have any meaningful near-term debt maturities and the company will generate some minimal discretionary cash flow, according to the agency.

Credit measures will remain relatively weak, with adjusted debt leverage above 6.0x, the agency noted.

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