S&P rates Allegiant loan BB-

Standard & Poor's said it assigned a BB- corporate credit rating to Allegiant Travel Co., parent of Allegiant Air, a BB- rating to the company's proposed $125 million secured term loan B due 2017 with a recovery rating of 4, indicating expectations of 30% to 50% recovery.

The outlook is stable.

"The ratings on Allegiant reflect its relatively small size within the U.S. airline industry, its reliance on leisure travelers, its relatively old and fuel-inefficient fleet (offset somewhat by low ownership costs), and the high risk and cyclical nature of the airline industry," S&P analyst Betsy Snyder said in a statement.

"Also incorporated in the rating is the company's low-cost structure and low leverage, each among the best of the U.S. rated airlines. Under our criteria, we characterize Allegiant's business risk profile as weak and its financial risk profile as significant."

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