S&P corrects Compass ratings

Standard & Poor's said it corrected its ratings on Compass Group Diversified Holdings LLC's $275 million revolving credit facility due 2016 to BB+ from BB-.

This action results from correcting the agency's recovery rating to 1, indicating an expectation of very high recovery in the event of a payment default, from 3, the agency said.

At the same time, S&P said it affirmed its BB- rating on the company's $225 million term loan B due 2017, but corrected the recovery rating to 4, indicating its expectation of average recovery in the event of a payment default, from 3.

S&P said its corporate credit rating on Compass Group remains at BB- and the outlook is stable.

In applying its recovery rating methodology to Compass Group's proposed credit facility, S&P said it incorrectly interpreted the payment priority of the senior secured revolver and senior secured term loan. Under the proposed financing, the revolver will rank senior in payment priority to obligations outstanding under the term loan rather than pari passu as initially concluded in S&P's reports published Oct. 3 and Oct. 4, the agency said.

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