Fitch to rate Spectrum Brands loan BB+, notes BB-

Fitch Ratings said it expects to rate Spectrum Brands, Inc.'s €150 million (about $187 million) senior secured term loan BB+ and the $250 million 6 1/8% unsecured notes maturing in December 2024 BB-.

Proceeds will be used to refinance short-term debt, pay for acquisitions and for general corporate purposes.

Near its fiscal year-end, Spectrum announced the $32 million acquisition of Tell Manufacturing, Inc. in the door and hardware sector, which closed on Oct. 2, and the pending acquisition of Procter & Gamble's European pet food business. The pet food transaction is expected to close in the second quarter of Spectrum's fiscal 2015 year. The Tell acquisition was financed mainly with short-term debt.

Spectrum's BB- rating and stable outlook are supported by its solid track record of improving margins, low single-digit organic growth rates since 2009 and ample levels of free cash flow that has been used to reduce debt.

The rating and outlook also consider the firm's value-based market strategy, which resonates well with challenged consumers in developed markets, the agency said.

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