S&P upgrades Covivio Hotels

S&P said it upgraded the long-term rating on Covivio Hotels to BBB+ from BBB, along with the rating on the debt to BBB+ from BBB.

The outlook is stable.

The ratings on Covivio Hotels are all in line with the ratings and outlook on Covivio because Covivio Hotels is a core subsidiary of Covivio and integral to the group's current identity and future strategy.

Covivio recently increased its stake in Covivio Hotels to 43.2% from 42.3% at year-end 2018, S&P noted.

The stable outlook reflects an expectation that the Covivio group will be able to maintain credit measures commensurate with the BBB+ rating throughout the cycle, the agency said.

This will require Covivio to maintain a disciplined financial policy, with disposals or equity increases compensating the company's sustained growth initiatives through capital spending and acquisitions over the next 24 months, S&P said.

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