S&P gives Albert Ballin BB-, Hapag-Lloyd notes B

Standard & Poor's said it assigned its BB- long-term corporate credit rating to Albert Ballin Holding GmbH & Co. KG and Hapag-Lloyd AG.

The outlook is stable.

In addition, the agency said it assigned an issue rating of B to the proposed $500 million of senior unsecured high-yield notes to be issued by Hapag-Lloyd. The recovery rating on the proposed notes is 6.

"The rating on Albert Ballin/Hapag-Lloyd reflects the group's aggressive financial risk profile, with adjusted total debt of €4.8 billion on Dec. 31, 2009," said S&P credit analyst Peter Kernan.

"It also reflects significant capital expenditure (capex) requirements to maintain a fleet of 127 vessels and container boxes, and highly cyclical industry characteristics."

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