S&P changes AK Steel to stable

S&P said it revised its outlook on AK Steel Holding Corp. and AK Steel Corp. to stable from positive.

At the same time, the agency affirmed the B corporate credit ratings on both entities and affirmed the BB- rating on the senior secured notes due 2023, as well as the B- issue-level rating on the senior unsecured notes with maturities of 2021 through 2027.

The recovery rating on the secured notes remains 1, indicating an expectation for very high (90%-100%; rounded estimate: 95%) recovery in the event of a payment default.

The recovery rating on the unsecured notes remains 5, indicating modest (10%-30%; rounded estimate: 20%) recovery.

S&P said the revision reflects an expectation that AK Steel's adjusted debt to EBITDA will remain elevated at about 5.5x to 6x in 2018 and 2019, which the agency views as consistent with the rating.

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