TEXT-S&P rates Expedia revolving credit facitlity 'BBB-'
Nov 9 - Standard & Poor's Ratings Services today assigned Bellevue, Wash.-based online travel agency Expedia Inc.'s amended and extended $1 billion revolving credit facility due November 2017 its 'BBB-' issue-level rating. The company's original $750 million revolving credit facility was due to expire in 2016. The corporate credit rating on Expedia is 'BBB-' and the rating outlook is stable. We have assumed that Expedia can maintain its market share in online travel and will adhere to its moderate financial policy. We view Expedia's business profile as "satisfactory" (based on our criteria) because of its good competitive position and good profitability. We expect Expedia to maintain adjusted debt leverage below 2.5x, which underpins our assessment of its financial risk as "intermediate." Expedia has a stated debt-leverage target of 2x to 3x. This roughly translates to lease-adjusted debt leverage of 2.2x to 3.2x. Expedia has "strong" liquidity to meet its routine business needs. Working capital is a positive contributor to cash flow. Uses of liquidity include capital expenditures of around $200 million to $220 million in 2012 and 2013. The other probable uses of cash include acquisitions and share repurchases. Maturities are minimal until 2018. RELATED CRITERIA AND RESEARCH -- Business Risk/Financial Risk Matrix Expanded, Sept. 18, 2012 -- Liquidity Descriptors For Global Corporate Issuers, Sept. 28, 2011 -- 2008 Corporate Criteria: Analytical Methodology, April 15, 2008 -- 2008 Corporate Criteria: Rating Each Issue, April 15, 2008 -- 2008 Corporate Criteria: Ratios And Adjustments, April 15, 2008 RATINGS LIST Expedia Inc. Corporate Credit Rating BBB-/Stable/-- New Rating Expedia Inc. $1B revolver due 2017 BBB- Complete ratings information is available to subscribers of RatingsDirect on the Global Credit Portal at www.globalcreditportal.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com. Use the Ratings search box located in the left column.
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