S&P rates Microchip facilities BB+

S&P said it affirmed its BB corporate credit rating on Microchip Technology Inc. and removed all ratings from CreditWatch, where they were placed with negative implications on March 2.

The outlook is stable.

The agency assigned a BB+ issue-level rating to the company's $3 billion senior secured term loans due May 2025 and $2 billion secured senior notes due 2021 and 2023. The 2 recovery rating indicates an expectation for substantial (70%-90%; rounded estimate: 70%) recovery.

S&P assigned a BB+ issue-level rating on the company's secured revolvers comprised of $244 million expiring February 2020 and $3.6 billion expiring May 2023. The 2 recovery rating indicates substantial (70%-90%; rounded estimate: 70%) recovery.

The agency affirmed the B+ issue-level ratings on Microchip's existing senior subordinated convertible notes due 2025 and 2027 and junior subordinated convertible notes due 2037. The recovery ratings remain 6, indicating negligible (0%-10%; rounded estimate: 0%) recovery.

S&P said the affirmation reflects Microchip's good market positions and its increased operating scale following the $10 billion acquisition of Microsemi.

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