S&P rates Grohe loans B+, bond B-

Standard & Poor's said it lowered its long-term corporate credit rating on Grohe Holding GmbH to B+ from BB- following the completion of the secondary buyout of the company. The outlook is stable.

S&P also assigned its B+ rating to Grohe's €900 million senior secured credit facilities with final maturity in 2013. In addition, a recovery rating of 3 has been assigned, indicating S&P's expectation of meaningful recoveries. Furthermore, S&P assigned its B- senior secured debt rating to the proposed €335 million high-yield bonds maturing in 2014.

The proceeds from the bank facilities have been used and the proceeds from the bond will be used to fund the recent secondary buyout of Grohe by a consortium led by Texas Pacific Group and Credit Suisse First Boston Private Equity from BC Partners.

"The rating actions reflect Grohe's weaker financial profile, due to an increased use of leverage after the secondary buyout," said S&P credit analyst Eve Greb.

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