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S&P rates Building Materials notes BB+
Standard & Poor's said it assigned a BB+ rating to Building Materials Corp. of America's proposed $350 million senior unsecured notes due 2018 based on preliminary terms and conditions, the same as the corporate credit rating. The agency also said it assigned a recovery rating of 4, indicating an expectation of 30% to 50% recovery in a default.
The agency also said it raised the ratings on the company's $975 million senior secured term loan due 2014 and $250 million 7% senior secured notes due 2020 to BBB from BBB- with the recovery ratings revised to 1 from 2, indicating an expectation of 90% to 100% recovery in a default. Also upgraded was the rating on the company's $325 million 7½% notes due 2020 to BB+ from BB- with the recovery rating revised to 4 from 6, indicating an expectation of 30% to 50% recovery in a default.
The corporate credit rating was affirmed at BB+.
The outlook is stable.
The ratings reflect the continued strong operating results in the company's roofing products business achieved due to stable sales and improved operating margins despite weak conditions in residential and commercial construction markets, S&P said.
The ratings also consider its fair business risk profile that incorporates a solid position in the consolidated North American asphalt roofing shingle market, where the company has a strong No. 1 market position, the agency said.
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