S&P ups Katun loan to BB-, recovery to 1

Standard & Poor's said it raised its recovery rating on Katun Corp.'s senior secured bank loan to 1 from 3 and bank loan rating for the company to BB- from B+. The company's B+ corporate credit rating was affirmed.

The outlook is stable.

The higher bank loan and recovery ratings reflect term loan repayment, which has reduced the bank facility to $85 million from $137 million, and the application of S&P's current interest rate and default scenario methodology.

The ratings reflect the company's relatively modest revenue and earnings base, increasingly competitive market conditions and lack of revenue growth, the agency said. These factors are partly offset by the company's good position as a niche office equipment parts distributor and a moderately leveraged financial profile.

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