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| Prospect News home > News index > List of issuers E > Headlines for ESH Hospitality, Inc. > News item |
S&P rates ESH Hospitality facility BB+
S&P said it assigned its BB+ issue-level and 1 recovery rating to Extended Stay America Inc. subsidiary ESH Hospitality Inc.'s proposed $1.65 billion senior secured credit facility consisting of a $350 million revolver due 2021 and a $1.3 billion term loan due 2023.
The 1 recovery rating reflects an expectation for very high (90% to 100%) recovery for lenders in the event of a default.
The company will use the proceeds to repay in full its $1.5 billion mortgage loan.
Extended Stay’s BB- corporate credit rating is unchanged.
The outlook is stable.
The BB- issue-level rating and 3 recovery rating on ESH Hospitality's $1.3 billion 5¼% senior unsecured notes due 2025 are also unchanged. The 3 recovery rating indicates an expectation for meaningful (50% to 70%; upper half of the range) recovery for lenders in the event of a default.
"The ratings reflect our expectation for anticipated improvement in operating performance that enables the company to sustain total adjusted debt to EBITDA below 5x and FFO to total adjusted debt above 12% through 2017," S&P credit analyst Daniel Pianki said in a news release.
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