S&P rates Generac loan B+

Standard & Poor's said it affirmed the B+ corporate credit rating on Generac Power Systems Inc.

The outlook is stable.

S&P also said it assigned a B+ rating to Generac Power's proposed $1.15 billion senior secured term loan B due 2020.

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

The proceeds will be used to refinance existing indebtedness and pay a special dividend of about $342 million.

The ratings reflect Generac's weak business risk, which is characterized by the highly discretionary nature of its residential standby generator products and exposure to raw material cost inflation, S&P said.

Those factors are offset by the company's increasing market penetration and higher margins than its peers, 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.