S&P: On Assignment loan BB-

Standard & Poor's said it assigned a preliminary BB- corporate credit rating to On Assignment Inc.

The outlook is stable.

The agency also assigned a preliminary BB- rating to the company's $540 million senior secured credit facility with a preliminary recovery rating of 3, indicating 50% to 70% expected recovery in a default.

The facility consists of a $490 million term loan due 2019 and a $50 million revolver due 2017.

The proceeds will be used, along with newly-issued common stock, to pay for its $600 million acquisition of Apex Systems Inc. and to refinance its existing debt.

The ratings reflect an expectation that On Assignment will be able to reduce leverage, generate positive discretionary cash flow and maintain an adequate cushion of covenant compliance over the intermediate term, S&P said.

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