S&P cuts Sun Products

Standard & Poor's said it lowered the ratings on Sun Products Corp. to B from B+, the rating on the company's first-lien senior secured credit facilities to BB- from BB and the rating on the second-lien senior secured term loan facility to B from BB.

The recovery ratings on the first-lien facilities remain 1, which continues to indicate very high recovery (90% to 100%). S&P revised the recovery rating on the second-lien facility to 4 from 1, indicating less-favorable recovery prospects for lenders than previously expected, based on lower EBITDA generation, which resulted in a lower enterprise value under simulated default scenario. Second-lien lenders are expected to obtain average recovery (30% to 50%).

The downgrade reflects deteriorating credit protection measures following very weak operating performance thus far in 2011, following declines in 2010, the agency said.

The negative outlook reflects the view that operating performance will remain under pressure through the end of 2011, the agency added.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.