S&P affirms Hertz

Standard & Poor's said it affirmed the BB rating on Hertz Corp.'s $1.4 billion term loan due in 2018 after a $750 million add-on.

The rating remains on CreditWatch with negative implications.

The recovery rating on this issue is 1, indicating 90% to 100% expected recovery in a default.

Hertz Corp. is the major operating subsidiary of Hertz Global Holdings Inc.

The proceeds from the add-on may only be borrowed in conjunction with Hertz's proposed acquisition of Dollar Thrifty Automotive Group Inc., S&P said.

The ratings remain on CreditWatch, where they were placed with negative implications in August after the company announced it entered into a definitive agreement to acquire Dollar Thrifty for $2.6 billion of cash and the assumption of $1.6 billion of its fleet debt, the agency said.

The company will fund the acquisition through a combination of Hertz's cash, Dollar Thrifty's cash and debt for which Hertz has committed financing, S&P said.

Unless there are additional material changes required to obtain regulatory approval, the agency said it would expect to affirm the corporate credit rating and assign a stable outlook upon the closing of the proposed transaction, which is expected by year-end or sooner.

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