S&P upgrades GrafTech

S&P said it raised its ratings on GrafTechInternational Ltd.’s $944 million (outstanding) senior secured term loan due 2025 and $500 million of senior secured notes due 2028 to BB from BB-.

The agency also revised the recovery rating on the senior secured debt to 2 from 3. The 2 recovery rating indicates substantial (70%-90%; rounded estimate: 75%) recovery in default.

“The rating action is predicated on the company’s recent announcement that, along with its term loan repricing, it plans to prepay $150 million on its senior secured term loan. Following the prepayment, we expect the term loan balance to be approximately $794 million. This action follows the company previously paying down about $400 million of its senior secured debt in 2020. It is our expectation that GrafTech will continue to use its excess free cash flow to further reduce its debt in 2021,” S&P said in a press release.

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