S&P rates Mercer notes BB-

S&P said it assigned its BB- issue-level rating and 3 recovery rating to Mercer International Inc.'s proposed $225 million senior unsecured notes due 2024. The 3 recovery rating reflects an expectation for meaningful (50%-70%; low end of range) recovery in the event of default.

“We assume the company will use the proceeds from the proposed notes issuance along with a modest amount of cash on hand to redeem its US$227 million of senior unsecured notes outstanding, due 2019, and to pay related call premium, fees and expenses,” S&P said in a news release.

“We expect the proposed transaction to improve Mercer's debt maturity profile further supporting our strong liquidity profile on the company. Our ratings on Mercer, including our BB- long-term corporate credit rating are unchanged.”

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