S&P rates Colfax loans BB+

Standard & Poor’s said it assigned BB+ rating and 3 recovery rating to Colfax Corp.’s $1 billion senior unsecured revolving credit facility due 2020 and $750 million senior unsecured term loan due 2020.

The proceeds from the term loan and revolver borrowings will be used to refinance a portion of its existing bank debt, as well as for working capital and general corporate purposes.

The 3 recovery rating indicates 50% to 70% expected default recovery.

The BB+ corporate credit rating and stable outlook on Colfax are unchanged.

The company maintains a good market position, broad geographic diversity and a significant portion of revenue from aftermarket or consumables sales, S&P said.

These positive credit factors are partially offset by the company’s exposure to cyclical and highly competitive markets, the agency said, as well as expected near-term softness in oil and gas and power generation markets.

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