S&P lifts Stater to stable, rates loan B+

Standard & Poor's said it affirmed the B+ corporate credit rating on Stater Bros. Holdings Inc.

The agency also said it revised the outlook on the company to stable from negative.

S&P also said it assigned a B+ rating to the company proposed $725 million credit facility, which consists of a $150 million revolving credit facility, $275 million term loan A and a $300 million term loan B.

The outlook revision follows the company's improved operating trends in its first quarter, the agency said.

This improvement was a result of operating-margin expansion and the refinancing transaction that enhances credit-protection measures as it reduces debt moderately, but substantially lowers the company's interest costs, S&P said.

The lower interest costs and longer term maturities will enable the company to generate greater free cash flow or make greater capital investments in the future, which could both be credit accretive, the agency said.

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