S&P rates Spotless, bond B

Standard & Poor's said it assigned a B long-term corporate credit rating to Spotless Holding SAS, along with a B long-term issue rating to its proposed €400 million senior secured bond maturing in 2018.

The recovery rating on this instrument is 4, indicating 30% to 50% expected recovery in a default.

The outlook is stable.

The ratings reflect the company's highly leveraged financial risk profile following a leveraged buyout by funds advised by private equity group BC Partners in April 2010 and the planned refinancing of its existing capital structure, including redemption of an existing shareholder loan, S&P said.

Its business risk profile is considered weak, the agency said, based on the group's narrow business and geographic focus, a degree of customer concentration risk and its participation in the mature and highly competitive European laundry care segment.

These risks are partly mitigated by the group's well-established positions in the color-protection market and other niche segments such as insect control, where it enjoys high brand awareness and consistently good margins, S&P said.

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