S&P rates Hanesbrands notes BB

S&P said it assigned its BB rating and 4 recovery rating to Hanesbrands Inc.'s proposed $500 million of senior unsecured notes due 2025. The 4 recovery rating indicates our expectation for average (30%-50%; rounded estimate: 35%) recovery in the event of a payment default.

“We expect the company to use the proceeds from these notes to repay a portion of the outstanding borrowings under its revolving credit facility and for general corporate purposes,” S&P said in a press release.

At the same time, S&P said it upgraded the rating on Hanesbrands' two tranches ($900 million each) of senior unsecured notes due in 2024 and 2026, respectively, to BB from BB- and revised the recovery rating to 4 from 5.

“Our higher recovery expectation for these notes reflects the lower amount of term loans outstanding in the company's capital structure due to its material repayment,” S&P said.

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