S&P rates Silgan loans BBB

Standard & Poor's said it revised the outlook on Silgan Holdings Inc. to stable from positive and affirmed its BB+ corporate credit rating and the ratings on its existing senior unsecured and subordinated debt.

The agency also said it assigned a BBB rating and a recovery rating of 1 to the company's proposed credit facilities, indicating an expectation for 90% to 100% recovery in the event of a payment default. The credit facilities include a $550 million revolving credit facility maturing in 2015, a $300 million term loan A, a €125 million term loan A and a C$81 million term loan due in 2016.

The proceeds will be used to repay its existing credit facilities, the agency said. The company also may use a portion of proceeds to redeem its 6¾% senior subordinated notes due 2013.

The ratings reflect the company's satisfactory business position as a major North American producer of rigid consumer goods packaging, steady earnings and free cash flow generation, S&P said.

Aggressive financial policies and other risks associated with the company's strategy of growth via acquisitions offset these strengths, the agency said.

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