S&P cuts Phoenix, rates Metal Services loan B

Standard & Poor's said it lowered its corporate credit rating on Phoenix Services International LLC to B from B+. The outlook is stable.

At the same time, the agency said it assigned a B issue-level rating to its subsidiary Metal Services LLC's proposed $275 million first-lien loan due 2017 and its proposed $30 million first-lien revolving credit facility due 2016.

The agency also assigned a 3 recovery rating, which indicates an expectation for meaningful recovery in the event of default.

"The lower rating reflects our expectation that leverage will increase to about 4.5x EBITDA from about 3.5x due to higher absolute debt levels associated with the company's proposed financing," said S&P credit analyst James Fielding in a news release.

"We view this level to be indicative of an aggressive financial risk profile and more in line with the lower rating."

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