TEXT-S&P raises FelCor notes rating to 'B+' from 'B-'
Jan 3 - Standard & Poor's Ratings Services today revised its recovery rating on FelCor Lodging L.P.'s 10% senior notes due 2014 to '1', indicating our expectation of 90% to 100% recovery for noteholders in the event of a payment default from '3' (50% to 70% recovery expectation). This resulted in our raising our issue-level rating on the notes to 'B+' from 'B-', in accordance with our notching criteria for a '1' recovery rating. The issue-level rating was removed from CreditWatch, where it was placed with positive implications on Dec. 12, 2012. FelCor Lodging L.P. is a subsidiary of FelCor Lodging Trust Inc. The rating action reflects the closing of the company's $525 million 5.625% senior secured notes due 2023 and the use of proceeds to repay $258 million of the 10% senior secured notes due 2014 ($492 million in notes were outstanding at Sept. 30, 2012). (See Standard & Poor's research report on FelCor dated Dec. 12, 2012.) The repayment of a portion of the company's 10% senior secured notes resulted in a lower level of secured debt outstanding under our simulated default scenario compared with our previous analysis. This increases recovery prospects for the 10% senior secured notes enough to warrant the upward revision to our recovery and issue-level ratings on the notes. RELATED RESEARCH -- Criteria Guidelines For Recovery Ratings, Aug. 10, 2009 -- 2008 Corporate Criteria: Rating Each Issue, April 15, 2008 RATINGS LIST FelCor Lodging Trust Inc. Corporate Credit Rating B-/Stable/-- RATINGS REVISED To From FelCor Lodging L.P. 10% sr nts due 2014 B+ B-/Watch Pos Recovery Rating 1 3 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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