S&P downgrades W3

S&P said it lowered the corporate credit rating on W3 Co. to CCC from B-.

The agency also said it lowered the rating on the company's first-lien term loan and revolver to CCC from B- and second-lien term loan to CC from CCC.

The recovery rating on the first-lien term loan and revolver remains at 3, indicating 50% to 70% expected default recovery.

The recovery rating on the second-lien term loan remains at 6, indicating 0 to 10% expected default recovery.

The downgrades reflect the revised estimates of the company's 2016 and 2017 revenues and EBITDA following weaker-than-expected full year 2015 and first quarter 2016 results, S&P said.

The downturn in the commodities market since late 2014 damaged the upstream business segment of W3, the agency added.

The negative outlook reflects a view that liquidity could deteriorate significantly over the next six- to 12-months, S&P said.

Moody’s lowers Tops view to negative

Moody's Investors Service said it changed the outlook on Tops Holding II Corp. to negative from stable.

The agency also said it affirmed the company's B3 corporate family rating and B3-PD probability of default rating.

The agency also affirmed the B3 rating of Tops Holding LLC's senior secured notes due 2022 and the Caa2 rating of Tops Holding II’s senior unsecured notes due 2018.

The outlook revision reflects uncertainty regarding the company's ability to improve its credit metrics to levels consistent with its B3 rating given the challenging and competitive business environment, Moody’s explained.

The group’s credit metrics position the company weakly in the B3 rating category with a debt-to-EBITDA ratio deteriorating to 7x at the end of fiscal 2015 from 6.6x the prior year, the agency said.

S&P upgrades Saga

S&P said it raised the long-term corporate credit rating on Saga plc to BB+ from B+ and assigned a long-term corporate credit rating of BB+ to Saga Midco Ltd.

The outlook is stable.

The agency also said it raised the rating on the £480 million term loan facility issued by Saga Midco to BB+ from B+.

Acromas Bid Co. Ltd. recently sold down its entire stake in Saga, S&P explained.

Historically, Acromas had extended shareholder loans to Saga prior to a 2014 initial public offering, the agency said.

S&P said it no longer incorporates this debt in Saga's total adjusted debt, therefore its credit metrics have improved.

Saga also repaid £220 million against the senior bank facilities during financial-year 2016, the agency added.

Despite continued competitive pressure on premiums in the insurance segment, Saga's business model remains robust with good claims experience and cost management, the agency said.

S&P: Energy Transfer on watch

S&P said it placed the BB corporate credit rating and other ratings on Energy Transfer Equity LP on CreditWatch with negative implications.

The 4 recovery rating on the senior secured debt is unchanged and indicates 30% to 50% expected default recovery.

The company announced in September that it would merge with the Williams Cos. Inc. The negative watch reflects an expectation that Energy Transfer’s stand-alone financial leverage pro forma for the merger will be considerably weaker than previous expectations, S&P explained.

Energy Transfer’s pro forma stand-alone debt leverage was revised to negative based on an expectation its debt-to-EBITDA will be nearly 7x annualized in 2016, instead of previous expectations of between 3.5x and 4x.

The deal faces both industry and legal headwinds with weaker commodity prices, the agency added.

Moody’s: Gap view to negative

Moody's Investors Service said it changed the outlook on the Gap, Inc. to negative from stable.

Moody's also said it affirmed the company's Baa2 senior unsecured rating.

The outlook revision reflects the continued and persistent weakness in sales for all three of the company's meaningful brands, which resulted in a steep drop in operating earnings and weaker credit metrics, the agency said.

The negative outlook also considers an uncertainty about management's ability to improve performance as a shift in consumer trends and competitive pressures create further headwinds, Moody’s explained.

Although the downward pressure on sales and operating income are expected to continue for the remainder of this fiscal year, leverage is still expected to be modest at less than 3x, the agency said.

S&P: Rockies Express view negative

S&P said it affirmed the BB+ corporate credit and senior unsecured debt ratings on Rockies Express Pipeline LLC.

The agency also said it revised the outlook to negative from stable.

The 4 recovery rating on the senior unsecured notes is unchanged and indicates 30% to 50% expected default recovery.

The outlook revision reflects the impact the recent Encana contract renegotiation is expected to have on the company’s near-term credit metrics, S&P said.

Offsetting this is the company’s ability to extend the tenure of these contracts through 2024, which improves the weighted average length of the contracts and mitigates a large percentage of the cash flow cliff risk associated with the legacy west-to-east volumes in 2019, the agency said.

S&P puts Williams on watch

S&P said it placed the BB corporate credit rating and other ratings on the Williams Cos. Inc. on CreditWatch with negative implications.

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

The 6 recovery rating on the junior subordinated notes also is unchanged and indicates 0 to 10% expected default recovery.

Williams announced in September that it would merge with Energy Transfer Equity LP, S&P said. The negative watch reflects an expectation that Energy Transfer’s stand-alone financial leverage pro forma for the merger will be considerably weaker than previous expectations, the agency explained.

S&P said it revised the assessment of the merged company's pro forma stand-alone debt leverage to negative based on an expectation of a debt-to-EBITDA ratio of nearly 7x in 2016 from previous expectations of between 3.5x and 4x.

The merger transaction also faces both industry and legal headwinds with weaker commodity prices, the agency added.

Moody’s rates Ardagh notes Ba3, B3

Moody's Investors Service said it assigned definitive Ba3 ratings Ardagh Packaging’s $500 million senior secured floating-rate notes due 2021, €440 million 4 1/8% senior secured notes due 2023 and $1 billion 4 5/8% senior secured notes due 2023.

The agency also said it assigned definitive B3 ratings to the group’s €750 million 6¾% senior unsecured notes due 2024 and $1.65 billion 7¼% senior unsecured notes due 2024.

All of the notes are issued by Ardagh Packaging Finance plc and Ardagh Holdings USA Inc., wholly owned subsidiaries of Ardagh Packaging Group Ltd.

The outlook is stable.

These notes represent a $1.65 billion increase on the amount Ardagh required to finance its acquisition of Ball Corp. and Rexam plc, Moody’s said.

The proceeds will be used to refinance existing facilities and have no material effect on leverage, the agency explained.

All other ratings, including the group’s B2 corporate family rating and B2-PD probability of default rating and existing instrument ratings are unchanged, Moody’s said.

The refinancing is credit positive as the new senior unsecured notes have been used to refinance existing unsecured debt at a lower interest rate, the agency said.

The refinancing will generate an annual cash interest saving of over $30 million, supporting an expectation that the group's cash flow generation will strongly improve over the next 12- to 24-months, Moody’s said.

Moody’s rates Realogy notes B2

Moody's Investors Service said it assigned a B2 rating to Realogy Group LLC's proposed senior unsecured notes.

The proceeds will be used to reduce loans currently outstanding under the senior secured revolving credit facility and to add cash to the balance sheet, Moody’s said.

Realogy also announced that it plans to extend the maturity date on its senior secured term loan B while reducing its size, the agency said.

Earlier this month, Realogy repaid $500 million of maturing 3 3/8% senior unsecured notes funded with borrowings under the revolving credit facility and cash on hand.

The proposed transaction is credit neutral and liquidity positive as it in effect refinances the $500 million of senior unsecured notes that were repaid in May 2016 with new debt and increases revolver capacity, Moody’s said.

If the company follows through on its announced plan to reduce its term loan B, the resulting decline in the proportion of senior secured debt to total debt could lead to an upgrade of the senior secured credit ratings to Ba2 from Ba3, the agency explained, or an upgrade of the senior unsecured rating to B1 from B2.

The ratings reflect expectations for solid ongoing financial performance at the company and rapid financial de-leveraging through debt repayment and EBITDA growth, Moody’s said.

S&P rates Realogy notes B

S&P said it assigned a B rating and 6 recovery rating to Realogy Group LLC's proposed $500 million senior unsecured notes issue due 2023.

The notes will be co-issued by wholly owned subsidiary, Realogy Co-Issuer Corp. and have a 6 recovery rating, indicating 0 to 10% expected default recovery.

The agency also said it placed the B rating on the proposed notes on CreditWatch with positive implications.

S&P also said it affirmed the B rating and 6 recovery rating on Realogy's existing senior unsecured notes due 2019 and 2021, and placed the B rating on CreditWatch with positive implications.

The agency also said it affirmed the BB+ rating on the company's senior secured debt. The recovery rating remains at 1, reflecting 90% to 100% expected default recovery.

The company’s BB- corporate credit rating and stable outlook are unchanged.

The proceeds will be used to repay outstanding borrowings under the company's revolving credit facility and for general corporate purposes, S&P said.

Realogy has stated its intention over the near term to extend the maturity date of its existing senior secured term loan B due 2020 and reduce the outstanding principal under the secured facility, the agency said.

S&P rates Telefonica subsidiaries BBB

S&P said it assigned a BBB corporate credit rating to Telefonica Emisiones SAU, Telefonica Europe BV, Telefonica Finance USA LLC and Telefonica Participaciones SAU.

The agency also said it affirmed all of the corporate credit and issue ratings on the group.

The outlook is stable.

The rating action equalizes the ratings on the fully owned financing subsidiaries with that on their parent, Telefonica SA, S&P explained.

The ratings reflect an assessment of the subsidiaries as core entities within the group, the agency said.

Fitch rates TransDigm notes B-

Fitch Ratings said it assigned a B- with recovery rating of RR5 to TransDigm Inc.'s issuance of $950 million of senior subordinated notes.

The ratings consider future issuance of up to $950 million in term loans, which are expected to be incurred sometime later in fiscal-year 2016, Fitch said.

The proceeds will be used to finance the acquisition of Data Device Corp. for about $1 billion and for general corporate purposes, the agency said.

TransDigm is a wholly owned subsidiary of TransDigm Group, Inc., Fitch said.

The outlook is stable.

The company recently announced it entered into a definitive agreement to purchase the stock of ILC Holdings, Inc., Fitch said.

The agency said it believes the acquisition will be a good business fit with its existing businesses.

Fitch said it does not expect the increase in debt to affect TransDigm’s ratings.

The ratings are supported by the company's strong free cash flow, good liquidity, strong margins and healthy commercial aerospace markets, the agency said.

S&P: General Motors loan BBB-

S&P said it assigned BBB- ratings to General Motors Co.'s $14.5 billion revolving credit facilities.

The facilities will consist of a $4 billion three-year credit facility and $10.5 billion five-year credit facility.

These facilities will replace the company's existing $12.5 billion credit facilities.

Following the creation of the new facilities, the agency said it believes that the company's automotive liquidity will remain strong and in line with most of its automotive peers.

The company has allocated a higher amount to its five-year tranche, which is roughly similar to what its peer Ford Motor Co. completed with the last amendment to its revolving credit facility, the agency said.

General Motors is expected to use the new revolver to fund working capital, issue letters of credit, help manage intra-year seasonality in its cash flows and potentially fund the company's strategic cash requirements, S&P said.

It is unlikely that the company will keep the revolver drawn for an extended period as it views it as backstop for unforeseen events, such as a severe industry downturn, the agency added.

S&P revised HERC recovery to 4

S&P said it revised the recovery rating on HERC Rentals Inc.'s proposed senior secured second-lien notes to 4 from 3 and affirmed its B+ rating on the notes following news that the company plans to upsize the issuance to $1.235 billion from $1.1 billion.

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

The revised recovery rating reflects more second-lien debt outstanding at default compared with a previous analysis, diluting recovery prospects for the second-lien noteholders, the agency said.

Herc Spinoff Escrow Issuer LLC and Herc Spinoff Escrow Issuer Corp. will co-issue the proposed second-lien notes, S&P said.

The ratings on HERC Holdings Inc. and HERC Rentals remain unchanged, the agency said.

S&P revises Speedway Motorsports recovery to 3

S&P said it affirmed the BB+ rating on Speedway Motorsports Inc.'s senior unsecured notes and revised the recovery rating to 3 from 4 following the company's repayment of about $80 million in debt.

This reflects improved recovery prospects for existing noteholders, S&P said.

The company has a BB+ corporate credit rating.

The 3 recovery rating reflects 50% to 70% expected default recovery.

The BBB ratings and 1 recovery ratings on the revolver due 2019 and $200 million delayed draw term loan due 2019 is unchanged.

Fitch rates Jabil notes BBB-

Fitch Ratings said it assigned a BBB- rating to Jabil Circuit, Inc.'s announced private placement of $300 million of senior unsecured notes due June 2023.

The proceeds will be used to repay Jabil's $312 million of existing 7¾% senior notes due July 2016.

Jabil has a long-term issuer default rating of BBB-, senior unsecured revolver rating of BBB- and senior unsecured notes rating of BBB-.

The outlook is stable.

The ratings reflect the company’s balanced global manufacturing footprint and full suite of increasingly complex EMS product offerings, Fitch said.

The company also benefits from high barriers to entry, the agency said.

But the company does derive a significant portion of its revenue from a small number of customers, Fitch said.

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