Moody's upgrades Kraton

Moody's Investors Service said it raised Kraton Performance Polymers, Inc.'s corporate family and probability-of-default ratings to B1 from B2, senior subordinated bonds to B3 (LGD5, 82%) from Caa1 (LGD5, 84%) and senior secured bank credit facility to Ba3 (LGD3, 31%) from B1 (LGD3, 33%).

This concludes the review for possible upgrade begun on Dec. 20, the outlook is stable.

The action follows the company's successful initial public offering, which Moody's views positively. A significant amount of the proceeds were used for debt reduction.

The agency said the ratings reflect the company's improved financial performance, which is aided by the company's lower leverage and improving credit profile; its steady margins through the cycle; and Moody's expectations that there will be significant medium-term demand improvement in the company's core SBC and IR latex end markets.

The ratings are constrained by continued near-term price and supply volatility in key raw materials isoprene and butadiene as well as the risk that the company will be unable to pass through timely near-term price increases to offset this short-term volatility, Moody's said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.