S&P downgrades Kraton

Standard & Poor's said it lowered the corporate credit rating on Kraton Performance Polymers Inc. to B+ from BB-.

The outlook is stable.

The agency also said it lowered the rating on the company's $350 million senior unsecured notes due March 2019 to B from B+. The recovery rating, which remains unchanged at 5, indicates 10% to 30% expected default recovery.

The downgrades reflect a view that current low market prices for butadiene and weaker end markets will result in EBITDA margins significantly lower than what was previously projected, said Pranay Sonalkar, an S&P analyst.

EBITDA margins are now expected to decline 7% to 8%, the agency said.

The stable outlook reflects a view that butadiene prices are unlikely to fall further and end-market demand declines will remain modest, S&P said.

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