S&P rates Summit loans B

Standard & Poor's said it assigned a B corporate credit rating to Summit Entertainment LLC, along with a B rating to its $750 million senior secured credit facilities with a recovery rating of 3, indicating 50% to 70% recovery in a default.

The outlook is stable.

The credit facilities consist of a $200 million revolving credit facility due March 2016 and a $550 million term loan due September 2016.

The facilities are guaranteed on a senior secured basis by the issuer's direct and indirect subsidiaries, with certain exceptions.

The proceeds will be used to repay its existing credit facilities, make a distribution to its members and for working capital and general corporate purposes, including the funding of film production and distribution costs.

The ratings reflect the company's short operating track record as a film producer, likely reliance on one film franchise for the majority of revenue for the next three years and an aggressive financial policy, S&P said.

The company's business risk profile is considered vulnerable because of its narrow business focus, revenue concentration on one movie franchise and earnings volatility from the timing of hit movie releases, the agency said.

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