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S&P lowers Kraton, rates loan B+, notes CCC+
Standard & Poor's said it lowered its corporate credit rating on Kraton Performance Polymers Inc. to B from B+ and its corporate credit rating on the wholly owned subsidiary Kraton Polymers LLC to B from B+.
S&P also lowered its corporate credit rating on Arizona Chemical Holdings Corp. to B from B+ and its corporate credit rating on the wholly owned subsidiary AZ Chem US Inc. to B from B+.
The agency removed the ratings from CreditWatch, where they were placed with negative implications on Sept. 29. The outlook is stable.
Kraton plans to acquire Arizona Chemical.
At the same time, S&P assigned its B+ issue-level and 2 recovery ratings to Kraton’s proposed first-lien secured term loan, indicating S&P’s expectation of substantial (low end of the 70% to 90% range) recovery in the event of a payment default.
S&P also assigned its CCC+ issue-level and 6 recovery ratings to Kraton's proposed senior unsecured notes, indicating S&P’s expectation of negligible (0% to 10% range) recovery in the event of payment default.
In addition, S&P lowered its issue-level ratings to B- from B and maintained the 5 recovery rating on Kraton’s existing senior unsecured debt, indicating S&P’s expectation of modest (higher end of the 10%-30% range) recovery in the event of a payment default.
S&P also lowered the issue-level ratings to B+ from BB- and maintained the 2 recovery ratings on Arizona Chemical's existing first-lien secured credit facilities, indicating S&P’s expectation of substantial (higher end of the 70%-90% range) recovery in the event of a payment default.
S&P also lowered its issue-level ratings to CCC+ from B- and maintained the 6 recovery rating on Arizona Chemical's existing second-lien secured credit facility. The 6 recovery rating indicates an expectation of negligible (0%-10% range) recovery in the event of a payment default.
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