S&P rates Equinix notes B+

Standard & Poor's said it affirmed Equinix Inc.'s B+ corporate credit rating and B- subordinated debt rating, assigned a BB- issue rating with a recovery rating of 2 to the company's proposed $500 million unsecured notes and then lowered the rating on the notes to B+ with recovery rating of 3 after the issue was upsized to $750 million.

The outlook was revised to positive from stable.

Proceeds will be used for general corporate purposes. This includes the repayment of debt, including debt expected to be assuming in connection with the planned acquisition of Switch & Data.

The lowered rating on the notes does not reflect any diminution in credit quality, the agency said, just a reduced recovery prospect in the event of a default.

S&P said the outlook revision reflects the company's performance over the past year, in which it consistently grew its revenues and EBITDA as it added customers at its data center facilities. Pro forma for the acquisition of Switch & Data and the current refinancing, leverage is at around the mid-4 times area.

The rating on Equinix reflects its competitive operating environment, anticipated significant near-term capital requirements and accompanying aggressive leverage, the agency said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.