S&P cuts Optima Specialty to CC, debt to CCC

S&P said it lowered its corporate credit rating on Optima Specialty Steel Inc. to CC from CCC-.

The outlook is negative.

At the same time, the agency downgraded its issue-level rating on the company's secured debt to CCC from CCC+. The recovery rating remains 1, indicating an expectation of very high (90% to 100%) recovery in the event of a payment default.

The rating on the unsecured debt is unchanged at C. The recovery rating remains 6, indicating an expectation of negligible (0% to 10%) recovery in the event of a payment default.

"The downgrade reflects our view that it is highly likely that Optima could default on its senior secured and senior unsecured notes, given upcoming maturities before the end of the year," S&P credit analyst Vania Dimova said in a news release.

"The company is actively negotiating a proposed refinancing plan that it is targeting to finalize by the end of November."

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