S&P rates Avis Budget notes BB

S&P said it assigned a BB rating and 4 recovery rating to Avis Budget Car Rental LLC's and Avis Budget Finance Inc.'s proposed $400 million senior unsecured notes due 2027.

The notes are guaranteed by parent company Avis Budget Group Inc.

The 4 recovery rating indicates 30% to 50% expected default recovery.

The proceeds will be used to redeem a portion of its outstanding senior unsecured notes due 2023 and for general corporate purposes, S&P said.

The ratings reflect the company's position as one of the largest global car rental companies and the price-competitive and cyclical nature of on-airport car rentals, the agency said.

The ratings also consider the relatively stable cash flow that the company's car rental business generates, even during periods of earnings weakness, S&P said.

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