S&P revises rating on Modular Space secured notes

Standard & Poor’s said it revised the recovery rating on Modular Space Corp.’s senior secured notes to 4 from 3.

The 4 recovery rating indicates 30% to 50% expected default recovery.

The agency also said it affirmed the B- rating on the company’s senior secured notes.

All of the other ratings on Modular Space are unchanged.

The recovery rating was lowered to reflect revised assumptions about the company’s usage of its asset-based lending revolver and an expectation that the value of the assets securing the notes will modestly decrease, S&P said.

The agency said it now expects the company will use about 75% of its revolver’s committed size, which is consistent with the level of borrowing seen over the past year.

The negative watch will be resolved after the company successfully extends the maturity of its ABL revolver, S&P said.

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