Fitch applies BBB to IHS, notes

Fitch Ratings said it assigned an initial issuer default rating of BBB to IHS, Inc.

The agency also assigned a BBB rating to IHS' proposed initial offering of $500 million of senior unsecured notes due 2022.

The outlook is stable.

As of Aug. 31, IHS had about $1.9 billion of debt outstanding.

Proceeds are expected to be used to repay amounts outstanding under the company's senior unsecured term loan scheduled to mature during 2015 and to repay a portion of the $850 million borrowed under the recently completed revolver. As such, the proposed transactions are expected to be leverage neutral.

IHS will be the issuer of the senior unsecured notes and the notes will benefit by a guaranty from the same domestic subsidiaries that guaranty the company's credit facility.

The notes will rank pari passu with the senior unsecured credit facility. Covenants include, among others restrictions on creating liens (subject to a leverage based incurrence test), limits on sale/lease-back transactions and restrictions on the company's ability to merge, consolidate or sell substantially all of its assets.

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