S&P rates Seven Seas notes CCC+

Standard & Poor's said it assigned a B corporate credit rating to Seven Seas Cruises S DE RL, along with a CCC+ rating to its proposed $200 million second-lien senior secured notes due 2017. The notes have a recovery rating of 6, indicating an expectation of 0% to 10% recovery in the event of default.

The outlook is negative.

The proceeds will be used to refinance the company's existing $139 million second-lien term loan, to repay $10 million of the existing first-lien term loan, to collateralize a $20 million second-lien letter of credit and to bolster cash balances, the agency said.

The rating reflects a vulnerability within the cruise sector because of its small fleet and niche market strategy, limited cash flow diversity, high debt leverage and the travel industry's susceptibility to economic cycles and global political events, S&P said.

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