S&P rates Granite loans BB-, B

Standard & Poor's said it assigned its BB- corporate credit rating to Granite Acquisition Inc.

At the same time, the agency assigned BB- issue-level ratings and 3 recovery ratings to the company's $1.25 billion first-lien term loan B due 2021, $125 million revolving credit facility due 2019 and $75 million term loan C due 2021. It also assigned a B issue-level rating and a 6 recovery rating to Granite's $260 million second-lien term loan due 2022.

The outlook is stable.

The company is using net proceeds to fund the purchase of Wheelabrator Technologies Inc. from Waste Management Inc. Granite will use the $75 million term loan C as cash collateral for letters of credit.

With no other holdings, the rating on Granite reflects Wheelabrator’s credit quality. The 3 recovery ratings indicate that lenders can expect meaningful (50% to 70%) recovery of principal if a payment default occurs, while the 6 recovery rating indicates lenders can expect negligible recovery.

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