Moody's boosts Rent-a-Center

Moody's Investors Service said it upgraded Rent-a-Center, Inc.'s corporate family rating to Ba2 from Ba3.

In addition, Moody's said it upgraded the company's senior secured bank ratings to Ba1 (LGD 2, 25%) from Ba2 (LGD 3, 39%).

Moody's noted that it also affirmed the company's Ba3 probability of default rating and assigned new ratings to the extended portion of the company's bank credit facilities.

The outlook is stable.

Affected ratings include the $400 million guaranteed senior secured revolver due 7/13/2011 to Ba1 (LGD 2, 25%) from Ba2 (LGD 3, 39%); $725 million guaranteed senior secured term loan B, due 6/30/2012, to Ba1 (LGD 2, 25%) from Ba2 (LGD 3, 39%); and $200 million guaranteed senior secured term loan A, due 6/20/2011, to Ba1 (LGD 2, 25%) from Ba2 (LGD 3, 39%).

The ratings upgrade is primarily driven by Moody's increasing to 65% its assumed family recovery rate in the event of default from its prior 50% assumption, the agency added.

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