U.K.-based visitor attractions operator Merlin Entertainments (Merlin) has announced solid results for 2014 and a debt refinancing; we anticipate these will support a further deleveraging of the company. We estimate that in the year ending December 2014, Merlin's adjusted debt/EBITDA ratio fell below 4x, and will fall further in 2015, supported by the debt repayment of about £130 million it has announced. We are affirming the 'BB' corporate credit rating on Merlin and assigning 'BB' issue ratings and '3' recovery ratings to the company's new bank facilities and proposed bonds, which form part of the unsecured refinancing package. The positive outlook reflects our opinion that there is at least a one-in-three probability that Merlin could transition to a higher rating
