S&P rates IM Australia loan BB

S&P said it assigned its BB issue-level rating and 2 recovery rating to IM Australia Group Pty. Ltd.'s proposed A$250 million senior secured term loan B due 2022. IM Australia Group Pty. Ltd. is a subsidiary of Iron Mountain Inc.

The 2 recovery rating indicates an expectation for substantial recovery (70%-90%; lower half of the range) of principal in the event of a payment default. Iron Mountain will use the proceeds to pay down revolver balances and for general corporate purposes.

The issue-level rating is one notch above the corporate credit rating on Iron Mountain.

“We assess Iron Mountain's business risk profile as satisfactory, reflecting the company's position as the largest records management company globally. The business benefits from low customer attrition, high switching costs, and long-term storage contracts that provide stable and recurring revenue. The threat of digital storage reducing physical storage volume over time somewhat offsets these strengths,” S&P said in a news release.

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