S&P lowers PRC recovery

Standard & Poor's said it revised its recovery rating on the proposed second-lien term loan due 2014 of PRC LLC (B+/stable), following the announcement that the company will increase the amount of the this loan by $12 million to $67 million and increase the amount of first-lien debt by $10 million to $160 million.

"We revised the recovery rating because of the larger amount of first-lien debt in the capital structure," said S&P credit analyst Andy Liu.

The agency noted it revised the recovery rating on the second-lien loan to 5 from 4, which, along with the B- bank loan rating, two notches below the B+ corporate credit rating, indicates the expectation of negligible recovery of principal in the event of a payment default.

S&P added that the first-lien credit facilities are rated BB-, one notch higher than the B+ corporate credit rating on the company, with a recovery rating of 1, indicating high expectation of full recovery of principal in the event of a payment default.

Pro forma for the increase, the first-lien credit facilities will consist of a $20 million revolving credit facility due 2012, a $25 million delayed-draw term loan credit facility due 2013 and a $115 million term loan due 2013, the agency said.

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