S&P puts GrafTech on watch

S&P said it placed GrafTech International Ltd.’s BB- issuer and BB senior secured term loan ratings on CreditWatch with negative implications.

“The CreditWatch placement reflects a potential impact to profits and cash flow following the suspension of GrafTech's operations at one its four graphite electrode manufacturing facilities. The company's graphite electrode manufacturing facility in Monterrey, Mexico received a temporary suspension notice following an inspection of its environmental and operating permits. It is uncertain how long its operations at the facility will remain suspended,” S&P said in a press release.

The Monterrey plant produces about a third of the company’s capacity.

“The CreditWatch placement reflects that we could lower our ratings if it appears that the facility will remain closed for an extended period, leading to some disruption in the company's operations and increasing the risk its leverage will rise above 3x,” the agency said in a press release.

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