S&P cuts Owens-Illinois facility, rates notes BB

S&P said it affirmed the BB corporate credit rating on Owens-Illinois Inc. and revised the outlook to stable from negative.

At the same time, the agency assigned a BB issue-level rating to the proposed $310 million senior unsecured notes to be issued by OI European Group BV.

The 3 recovery rating indicates an expectation for meaningful (50%-70%; rounded estimate: 65%) recovery for lenders in the event of a payment default.

Proceeds will be used to fully repay all amounts outstanding on the company's euro-denominated term loan A facility.

S&P lowered the issue-level rating on Owens-Illinois' senior secured credit facility to BB+ from BBB- based on the revision in the recovery rating to 2 (70%-90%; rounded estimate: 75%) from 1.

In addition, the agency affirmed all other existing issue-level and recovery ratings.

S&P said the outlook revision reflects improved credit metrics resulting from debt reduction and reflects an expectation that Owens-Illinois will continue to successfully execute around efforts to improve its operating efficiency and reduce costs.

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