S&P rates EMSC loans B+, notes B-

Standard & Poor's said it assigned its B+ corporate credit rating to EMSC LP, the parent company of AMR Holdings and EmCare Holdings. The outlook is stable.

Financial sponsor Onex Partners LP is acquiring AMR and EmCare for $836 million. After the transaction, Onex will own 98% of EMSC, and the management team will own 2%.

S&P also assigned its B+ senior secured debt rating and 2 recovery rating to AMR Holdings and EmCare Holdings' proposed co-issue of a $100 million senior secured revolving credit facility maturing in 2011 and a $350 million senior secured term loan B maturing in 2012.

S&P also assigned its B- subordinated debt rating to AMR Holdings and EmCare Holdings' proposed co-issue of $250 million in senior subordinated notes maturing in 2015.

The low-speculative-grade ratings reflect EMSC's heavy exposure to reimbursement changes, its relatively thin operating margins, the rising malpractice costs associated with its EmCare business, its high levels of bad debts and its aggressive use of debt, according to S&P.

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