S&P rates McJunkin Red Man notes B

Standard & Poor's said it assigned B issue and 5 recovery ratings to McJunkin Red Man Corp.'s proposed $1 billion senior secured notes due 2016.

The agency affirmed the issuer and its holding company parent McJunkin Red Man Holding Corp.'s B+ corporate credit ratings.

The outlook is negative.

Proceeds will be used to repay outstanding debt under McJunkin's term loan facility and its parent's junior term loan facility.

"The affirmation reflects our assessment that despite likely challenging operating conditions in 2010 due to low drilling activity and weak economic activity, we expect the company's overall liquidity position to remain sufficient to enable it to meet its obligations during the intermediate term, including a potential improvement in operations requiring working capital funding," S&P analyst Sherwin Brandford said in a statement.

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