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S&P rates Marriott debentures
Standard & Poor's said it assigned its B+ rating to Host Marriott LP's proposed $375 million cash pay exchangeable senior debentures due 2024. Concurrently, S&P affirmed its ratings, including its B+ corporate credit rating, on Host Marriott Corp.
The outlook is stable.
Proceeds from the notes will be used to redeem a portion of Host Marriott LP's existing $1.2 billion 7.875% series B senior notes due 2008 and to pay fees and expenses.
S&P said the ratings for Host Marriott reflect its very high debt leverage and the expectation that credit measures will remain weak for the ratings for several quarters, given S&P's expectation for a gradual lodging industry recovery.
These factors are partially offset by the high quality of Host Marriott's hotels, the geographic diversity of its portfolio, and its experienced management team. Moreover, the company's good liquidity position and historically good access to both debt and equity capital markets are viewed favorably.
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