S&P rates HP Pelzer notes B+, view to positive

S&P said it revised the outlook on HP Pelzer Holding GmbH, the 100%-owned subsidiary of Adler Plastic SpA, to positive from stable.

The agency also said it affirmed the B+ long-term corporate credit rating on the company.

S&P also said it assigned a B+ rating to HP Pelzer's proposed €350 million senior secured notes due in 2024.

The 3 recovery rating indicates 50% to 70% expected default recovery.

The agency also said it affirmed the B+ rating on the company's existing €280 million senior secured notes.

The recovery rating remains at 3, indicating 50% to 70% expected default recovery.

The outlook revision reflects the strengthening of HP Pelzer's business risk profile since October 2014, S&P said.

Since then, HP Pelzer's revenues have grown by 44% to €1.3 billion as of year-end 2016 from €885 million in 2013, the agency said.

The company plans to refinance its entire capital structure with new €350 million senior secured notes and use the net proceeds for dividends and general corporate purposes, S&P said.

Following the refinancing, the company is expected to benefit from a €5 million to €7 million reduction in interest expense that will mitigate the negative impact on its FFO-to-debt ratio, the agency said.

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