S&P rates Stanadyne notes, loan

Standard & Poor's said it affirmed its BB- corporate credit and B subordinated debt ratings on Stanadyne Corp. and removed them from CreditWatch where they were placed on June 24.

At the same time, S&P assigned its BB senior secured bank loan rating and its recovery rating of 1 to Stanadyne's proposed $35 million senior secured asset-based revolving credit facility and its B+ senior secured debt rating and its recovery rating of 3 to Stanadyne's proposed $65 million senior secured term loan.

S&P also assigned its B debt rating to the company's proposed $160 million senior subordinated notes.

The outlook is stable.

The rating affirmation and CreditWatch resolution reflect S&P's analysis of the company's expected business strategy, capital structure, and financial policy following a transaction whereby Stanadyne will be purchased by an affiliate of Kohlberg & Co. LLC, a private merchant bank.

Stanadyne will have about $225 million of total debt pro forma at the transaction's closing, which is expected to occur in the third quarter of 2004. Proceeds from the issuance of debt will be used to refinance certain existing debt, to partly fund Kohlberg's purchase of Stanadyne's equity, to provide working capital financing, and for other general corporate purposes.

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