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Published on 10/17/2013 in the Prospect News Bank Loan Daily and Prospect News Distressed Debt Daily.

S&P rates Continental Building loans B+, CCC+

Standard & Poor's said it assigned a B corporate credit rating to Continental Building Products LLC.

The agency also said it assigned a B+ rating to Continental's $370 million first-lien credit facilities. The recovery rating is 2, indicating 70% to 90% expected default recovery.

S&P also said it assigned a CCC+ rating to Continental's $120 million second-lien term loan due 2021. The recovery rating is 6, indicating 0% to 10% expected default recovery.

The outlook is stable.

The proceeds were used to fund Lone Star Funds' acquisition of Continental. Total consideration for the acquisition is $700 million, S&P said.

The stable outlook reflects an expectation of improved operating performance driven by recovering residential construction and repair and remodeling spending, the agency said.

As a result, S&P said it expects Continental to generate positive free cash flow that will go toward repayment of debt.


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