S&P affirms Essar Steel Algoma, removes watch

Standard & Poor's said it removed Essar Steel Algoma Inc.'s ratings from CreditWatch, where they were placed with developing implications in April.

The agency also said it affirmed Essar's CCC+ long-term corporate credit rating.

The outlook is developing.

The removal of the CreditWatch reflects the completion of Essar Steel's two-year $350 senior secured term loan with the proceeds subsequently being used to repay and terminate its $300 million senior secured revolving credit facility, S&P said.

The ratings reflect the company's highly leveraged financial risk profile, featuring a less-than-adequate liquidity position, a large debt burden and thin coverage ratios, the agency said.

The ratings also consider its vulnerable business risk profile, featuring an exposure to volatile end markets and limited operating diversity, S&P said.

These risks are somewhat counterbalanced by the company's better-than-average cost profile, the agency said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.