Fitch rates Penske notes BBB+

Fitch Ratings said it expects to assign a rating of BBB+ to the five-year $500 million senior unsecured debt co-issued by Penske Truck Leasing Co., LP and PTL Finance Corp.

The expected unsecured debt rating reflects the fact that the debt is expected to rank pari passu with all other senior unsecured debt issued by Penske and PTL Finance, Fitch said.

The equalization of the expected rating with Penske’s issuer default rating reflects the predominantly unsecured funding profile and unencumbered asset coverage available to senior unsecured creditors, the agency said.

Fitch said it does not believe there will be a material impact on the company’s leverage as a result of the issuance, as proceeds will be used to pay-down existing debt under its corporate revolver and ABS facility.

The ratings reflect the company’s established market position in the truck leasing business, growing market share in the logistics business, operating consistency and strong liquidity and funding profile, the agency said.

Rating constraints include cyclicality inherent in used-vehicle pricing and the commercial rental business, customer concentration in the logistics segment and potential regulatory impacts on business trends, Fitch added.

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