S&P: Service Corp. loan BB+

Standard & Poor’s said it assigned a BB+ rating to Service Corp. International’s new $1.4 billion senior unsecured credit agreement consisting of a $700 million revolving credit facility due 2021 and $700 million term loan A due 2021.

The recovery rating on this debt is 3, indicating 50% to 70% expected default recovery. The recovery rating on the credit facility is capped at 3.

The proceeds will be used to repay revolver borrowings and to redeem all of the 6% senior notes due 2017, S&P said.

The rating on the senior unsecured notes that do not have guarantees remains at BB.

The recovery rating on these notes is 5, indicating 10% to 30% expected default recovery.

The company’s BB+ corporate credit rating and stable outlook reflects the company’s narrow, but leading position as a provider of funeral and cemetery services, S&P said.

The ratings also reflect an expectation that adjusted leverage will range between the mid-3x and low-4x range over the next couple of years, the agency said.

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