S&P rates Borden chemical loans BB-, add-on B-, preferreds CCC+

Standard & Poor's said it affirmed its B+ corporate credit rating and other ratings for Borden Chemical Inc. S&P also affirmed its B+ corporate credit rating and other ratings for Resolution Specialty Materials LLC.

S&P also assigned its BB- senior secured bank loan rating and a recovery rating of 1 to Borden Chemical's proposed $675 million of bank credit facilities and its B- rating and a recovery rating of 5 to the company's proposed $250 million of senior second secured notes, which is an add-on to the company's existing senior second secured notes.

In addition, S&P assigned its CCC+ rating to Borden Chemical's proposed $350 million of series A preferred stock.

The ratings on Borden Chemical and Resolution Specialty were removed from CreditWatch negative. The outlook is negative.

The B- corporate credit rating and other ratings for Resolution Performance Products LLC remain on CreditWatch positive, pending completion of a previously announced merger of Borden Chemical, Resolution Specialty and Resolution Performance.

Upon completion of the merger, Borden Chemical is expected to be the surviving legal entity and the company will change its name to Hexion Specialty Chemicals Inc.

S&P said the overall creditworthiness of the combined company will reflect a very aggressive financial profile resulting from high debt leverage at the outset of the merger.

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