Moody's rates Europcar notes B3

Moody's Investors Service said it assigned a B3 rating to the new €450 million senior notes due 2026 to be issued by Europcar Mobility Group SA.

The proceeds from the new notes, together with drawings of €150 million under the revolving credit facility that was increased by to €650 million, will be used to refinance the existing €600 million senior notes due 2022, Moody's said.

The proceeds will initially be held into escrow until repayments of the 2022 senior notes, which the company expects to take place in June 2019, the agency said.

Upon completion of the early bond redemption, Moody's said it will withdraw the existing B3 rating on the €600 million senior notes due 2022.

The company's corporate family rating of B1 and probability of default rating of B1-PD, along with the B3 ratings on the existing senior notes are unchanged.

The B1 rating on the existing senior secured notes issued by EC Finance plc also are unchanged.

The outlook is stable.

The ratings reflect Europcar's strong brands and leading positions in the largest European car rental markets of France, Germany, Spain, the United Kingdom and Italy, Moody's said.

The ratings also consider its well-balanced revenue mix between leisure and business customers and the exposure to the faster growing low cost segment of the car rental industry following the acquisition of Goldcar in 2017, the agency said.

The ratings are constrained by its exposure to the cyclical and highly competitive European car rental sector, Moody's said.

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