S&P rates Fifth Third loans BB-, B-

Standard & Poor's said it assigned a preliminary B+ corporate credit rating to Fifth Third Processing Solutions LLC and a preliminary BB- rating to the company's proposed $150 million senior secured revolving credit facility and $1.5 billion first-lien term loan, with a preliminary recovery rating of 2, indicating an expectation for 70% to 90% recovery in a default.

The agency also said it assigned a preliminary B- rating to the proposed $275 million second-lien term loan, with a preliminary recovery rating of 6, indicating 0% to 10% expected recovery in a default.

The outlook is stable.

The company said it intends to use proceeds in part to finance the acquisition of National Processing Co. and to refinance its existing debt.

The ratings reflect the company's leveraged financial profile and a view that the company's ownership structure is likely to preclude sustained deleveraging, despite a solid U.S. market position and consistent operating performance, S&P said.

The acquisition will expand the company's presence in the small- to midsize-merchant base, the agency said, and should enable the company to realize processing economies of scale when the acquisition is fully integrated.

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