S&P gives LSB notes B+

Standard & Poor's said it assigned its B+ corporate credit rating to LSB Industries Inc.

The outlook is stable.

At the same time, the agency assigned its B+ issue-level rating to the company's $425 million senior secured notes due 2019, with a recovery rating of 3, indicating an expectation for meaningful (50% to 70%) recovery in the event of a payment default.

LSB plans to use the proceeds from the note offering to refinance outstanding borrowings and for general corporate purposes, including capital spending.

"The ratings on LSB reflect the company's rather narrow focus on commodity nitrogen-based products, multiple operational problems over the past year, and our expectation of significantly negative free operating cash flow over the next two years," S&P credit analyst Seamus Ryan said in a news release.

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