Moody's rates Rent-A-Center loans

Moody's Investors Service assigned a Ba2 rating to Rent-A-Center's Inc. proposed senior secured credit facilities and affirmed the company's existing ratings.

The outlook was changed to positive from stable.

Moody's assigned a Ba2 rating to Rent-A-Center's $200 million senior secured revolving credit facility and its $400 million senior secured term loan B. Moody's affirmed the company's Ba2 senior implied rating, its senior subordinated notes due 2010 at B1 and its issuer rating at Ba3.

The proceeds of the proposed term loan B will be used to repay the existing term loan B.

The ratings reflect the management team's proven ability to successfully integrate acquisitions, the company's dominant market share, a moderate expected level of acquisition activity and the relatively low capital investment required for new store openings, Moody's said.

Adjusted debt/EBITDAR improved to 3.3x for the last 12 months ended March 31 versus 4x for fiscal year 2001.

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