S&P rates Shearer's Foods loans B

Standard & Poor's said it assigned a B corporate credit rating to Shearer's Foods Inc. and B ratings to its proposed $20 million revolving credit facility and $119 million term loan B due 2015 with 3 recovery rating.

The outlook is stable.

Proceeds will be used to fund the acquisition of Snack Alliance, refinance its existing credit facility and for general corporate purposes.

"The ratings on Shearer's reflect the company's narrow product focus, relatively high customer concentration, limited international presence and highly leveraged capital structure," S&P analyst Alison Sullivan said in a statement.

The company's pro forma lease-adjusted total debt-to-EBITDA ratio is about 5x, or about 4.7x with synergies, for the 12 months ended Dec. 31.

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