S&P lowers Quality Home Brands

Standard & Poor's said it lowered its ratings on Quality Home Brands Holdings LLC, including its corporate credit rating, to CC from CCC. The outlook is negative.

S&P also lowered the issue ratings on the company's $20 million senior secured revolver and $290 million senior secured first-lien term B bank loan due 2012 to CC from CCC. The recovery rating on these facilities remains at 4, indicating S&P's expectation for average (30%-50%) recovery in the event of a payment default.

Concurrently, S&P lowered the issue rating on the $100 million second-lien term bank loan due 2013 to C from CC. The recovery rating remains at 6, indicating the expectation for negligible (0%-10%) recovery in the event of a payment default.

"The downgrade reflects our increased concerns about the company's liquidity position because of its continued very weak operating performance and very limited financial covenant cushion," said S&P credit analyst Bea Chiem in a news release.

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