S&P gives Summit Materials notes B

Standard & Poor's said it assigned its B issue-level rating to Summit Materials LLC's proposed $250 million senior unsecured notes due 2022.

The recovery rating is 5, indicating the view that creditors could expect modest (higher half of the 10% to 30% range) recovery in the event of a payment default.

The agency expects the company will use the net proceeds to fund its expected acquisition of Boxley Materials Co., as well as for general corporate purposes.

All existing ratings on Summit Materials, including the B+ corporate credit rating, BB senior secured debt rating and existing B senior unsecured notes rating, are unchanged.

The outlook is stable.

S&P projects that pro forma for the new debt financing and acquisition, Summit's debt leverage will approximate 5.25 times, which is in line with the current B+ corporate credit rating and highly leveraged financial risk profile.

S&P said the ratings on Summit Materials incorporate the assessment of the company's financial risk profile as highly leveraged and its business risk profile as satisfactory.

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