S&P rates KCA Deutag loan B

Standard & Poor's said it assigned its B issue rating to the proposed $750 million senior secured term loan B and $250 million working capital facility to be borrowed by KCA Deutag GmbH and KCA Deutag US Finance LLC, subsidiaries of the main group parent KCA Deutag Alpha Ltd.

The agency assigned a recovery rating of 3 to the proposed debt, indicating an expectation of meaningful (50%-70%) recovery in the event of a payment default.

At the same time, S&P affirmed its B issue rating on KCA Deutag's existing senior secured debt instruments and revised the recovery rating on these instruments to 3 from 4.

S&P said the issue and recovery ratings on the proposed senior secured debt reflect the fairly comprehensive security package, comprising share pledges over KCA Deutag and its main subsidiaries, and pledges over all the assets (receivables, inventory, stock and goods and vehicles and machinery) of certain subsidiaries.

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