S&P rates eDreams Odigeo notes B, loan BB-

S&P said it assigned a B corporate credit rating to eDreams Odigeo SA.

S&P also said it assigned a B rating to the proposed €425 million senior secured notes due in 2021. The recovery rating is 4, indicating 30% to 50% expected default recovery.

The agency also said it assigned a BB- rating to eDreams Odigeo’s new €117 million super senior revolving credit facility due in 2019. The recovery rating is 1, indicating 90% to 100% expected default recovery.

The outlook is stable.

The newly assigned ratings follow news that eDreams Odigeo plans to issue senior secured notes to repay €424 million of outstanding debt at its subsidiary, Geo Travel Finance SCA Luxembourg.

Following the debt repayment at Geo Travel, the B rating on Geo Travel will be withdrawn and Geo Travel will be combined into eDreams Odigeo, S&P explained.

After the simplification of the organizational structure, eDreams Odigeo will be the sole issuer of debt in the group, the agency said, and the agency’s financial analysis on the company will be based on the consolidated financial statements of eDreams Odigeo, S&P said.

The company reported strong results for the three months that ended June 30 with its adjusted EBITDA increasing by 30% as a result of demand growth and strategic initiatives to improve product, re-orient pricing and channel performance, improve customer service and reduce variable costs per booking, the agency said.

The industry outlook is viewed as broadly supportive for the company, as well, S&P said.

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