S&P lowers Heckler & Koch

Standard & Poor’s said it lowered the long-term issue rating on Heckler & Koch GmbH’s senior secured notes to CCC- from CCC and revised the recovery rating on the notes down to 5 from 4.

The 5 recovery rating indicates 10% to 30% expected default recovery.

The agency also said it affirmed the long-term corporate credit rating on Heckler & Koch at CCC.

The outlook is negative.

The downgrade follows Heckler & Koch’s recent extension of the maturity of its €30 million revolving credit facility, which reduced the ranking of the group’s €295 million senior secured notes in the capital structure, S&P said.

The agency said it believes that the availability of the revolver improves Heckler & Koch’s liquidity position.

Despite this improvement, S&P said it continues to believe that the group’s uncertain business prospects and highly indebted capital structure continue to pose risks.

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