Fitch gives BB to Rexel notes

Fitch Ratings said it assigned Rexel SA's planned €500 million senior unsecured notes issue due in 2025 an expected senior unsecured rating of BB (EXP).

Proceeds are likely to be used for early redemption of the company's 3¼% notes due in 2022 on or about Dec. 15, 2017.

The planned notes will be unguaranteed, ranking pari passu to all existing and future unsecured debt of the issuer that is not subordinated to the notes, including that under senior credit facilities.

Although under each of Rexel's bonds and the senior credit facilities creditors only have a claim to the parent company, there is cross-default with additional group debt above a minimum threshold of €100 million.

Fitch said it expects average recovery prospects for unsecured bond holders in the event of default resulting in a BB (EXP) rating for the planned bond.

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