S&P lifts Grohe to positive

Standard & Poor's said it revised the outlook on Grohe Holding GmbH, the indirect parent of Grohe AG, to positive from stable.

The agency also affirmed Grohe's B- long-term corporate credit rating, along with the B- issue ratings on its senior secured debt comprising the €375 million-equivalent senior secured term loan and the €500 million senior secured notes.

The recovery rating on these debt is 3, indicating 50% to 70% expected recovery in a default.

S&P also affirmed the B+ rating on Grohe's €150 million super senior revolving credit facility due 2016. The recovery rating on the revolver is 1, indicating 90% to 100% expected recovery in a default.

The outlook revision reflects a view that Grohe will continue to outperform the tough conditions in its end markets, with modest positive sales growth in 2013 for its core operations, the agency said.

This is despite a view that the European end markets - where Grohe still derives about one-half of its sales - will remain extremely difficult in 2013, S&P said.

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