S&P rates Ontex bonds B+, B-

Standard & Poor's said it assigned the B+ long-term corporate credit rating to Ontex IV SA, along with the B+ long-term issue rating its proposed €570 million senior secured bond maturing in 2018.

A recovery rating of 4 was assigned to this bond, indicating 30% to 50% expected recovery in a default.

The agency also said it assigned a B- long-term issue rating to Ontex's proposed €235 million senior unsecured bond maturing in 2019 with a recovery rating of 6, indicating 0% to 10% expected recovery in a default.

The outlook is stable.

The ratings on the proposed bonds are based on preliminary information and are subject to the successful issuance of these instruments and a satisfactory review of the final documents.

The ratings reflect its highly leveraged financial risk profile following the initial leveraged buyout and subsequent refinancing in 2007 and 2010, S&P said.

The rating also reflects Ontex's satisfactory business risk profile, which is supported by the group's leading position in the niche private-label market for hygienic disposable products in Europe, the agency said, and its good cash-generation capacity.

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