S&P rates Griffon, notes BB- and loan BB+

Standard & Poor's said that it assigned a BB- preliminary corporate credit rating to Griffon Corp.

The outlook is stable.

S&P assigned a preliminary BB+ issue-level rating to Griffon's proposed $200 million revolving credit facility due 2016 with a preliminary recovery rating of 1, indicating the expectation that lenders can expect very high (90% to 100%) recovery in the event of a payment default.

S&P also assigned a preliminary BB- issue-level rating to the company's proposed $500 million of senior notes due 2018 with a preliminary recovery rating of 3, indicating the expectation of meaningful (50% to 70%) recovery in the event of a payment default.

The company plans to use proceeds from the proposed financings to repay outstanding bank debt at its Clopay Ames subsidiary and to replace existing revolving credit facilities at both Clopay Ames and Telephonics, as well as to pay related fees and expenses.

The ratings reflect the company's fair business risk profile and aggressive financial risk profile, as well as its sizable customer concentrations in each of its business segments and exposure to fluctuation in the construction industry through its building products business, the agency said.

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