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S&P rates Genesee & Wyoming loans BB+
Standard & Poor's said it assigned a BB- corporate credit rating to Genesee & Wyoming Inc. and assigned a BB+ rating to the company's proposed $2.3 billion senior secured credit facility, consisting of a $425 million multicurrency revolver, as well as term loan A and term loan B tranches.
The agency assigned each tranche of this debt a 1 recovery rating, indicating expectation of 90% to 100% recovery.
The outlook is stable.
Proceeds will be used to purchase RailAmerica Inc. as well as refinance debt.
"The ratings on Genesee & Wyoming reflect the company's significant debt levels, capital intensity, and acquisitive growth strategy," S&P analyst Anita Ogbara said in a statement.
"Partially offsetting these weaknesses are the company's sizeable market position, operating the largest network of individual short-line railroads, and its participation in the relatively stable North American freight railroad industry."
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