S&P rates Lubrizol notes BB+

Standard & Poor's said it affirmed its BB+ corporate credit and senior unsecured debt ratings on Lubrizol Corp. and removed them from CreditWatch, where they were placed with negative implications on April 16 following the company's announcement that it had signed an agreement to acquire Noveon International Inc. for about $1.8 billion.

The outlook is stable.

At the same time, S&P assigned a BB+ rating to $400 million of senior notes due 2009, $400 million of senior notes due 2014, and $300 million of senior debentures due 2034.

Proceeds will be used to retire about $2 billion of debt incurred by Lubrizol under a temporary bridge facility used to fund the June acquisition of Noveon and the repayment of some Noveon debt. A planned concurrent common equity offering of about $442 million and bank term loan of $575 million will refinance the balance of the borrowings under the bridge facility.

S&P said the credit quality of Lubrizol reflects its aggressively leveraged capital structure as a result of the Noveon acquisition, tempered by a $3.4 billion globally diversified specialty chemicals product portfolio that supports an above-average business profile.

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