S&P rates Modular Space notes B-

Standard & Poor's said it assigned its B- corporate credit rating to Modular Space Corp.

The outlook is stable.

At the same time, the agency assigned a B- issue rating to the company's proposed $365 million senior secured second-lien notes due 2019 with a recovery rating of 4, which indicates an expectation of an average (30%-50%) recovery in the event of a payment default.

S&P said the rating reflects its view of the cyclicality of demand for Modular Space's leased modular units as well as the company's significant debt levels and weak credit metrics, offset somewhat by its substantial market position in the modular space industry, which it believes is beginning to recover from a prolonged slump related to the economic downturn.

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