S&P rates Central Security loans B-, CCC

Standard & Poor’s said it assigned a B- corporate credit rating to Central Security Group Inc.

The outlook is stable.

The agency also said it assigned a B- rating with a recovery rating of 4 to the company’s $50 million revolving credit facility and $225 million first-lien term loan.

The 4 recovery rating indicates 30% to 50% expected default recovery.

S&P also said it assigned a CCC rating with a recovery rating of 6 to the company’s $50 million second-lien term loan. The recovery rating of 6 indicates 0 to 10% expected default recovery.

The ratings reflect the company’s limited scale, highly competitive alarm monitoring services market with low barriers to entry and its reliance on debt to fund anticipated growth, the agency said.

Low residential alarm monitoring market-penetration rates and Central Security’s recurring and growing revenue base partly offset these factors, S&P said.

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