S&P: Actuant on watch

Standard & Poor's said it placed its BB corporate credit rating on Actuant Corp. on CreditWatch negative following the company's announcement that it signed a definitive agreement to purchase Key Components Inc. from an investor group for $315 million.

On watch are Actuant's BB rated senior secured debt and B+ senior subordinated convertible debt.

S&P said Actuant expects to finance the acquisition with $250 million of new debt and about $125 million of common equity.

The CreditWatch listing reflects the magnitude of the acquisition, since the existing rating on Actuant contemplates only small acquisitions and the related increase in near-term leverage resulting from the proposed transaction, unless the common equity issuance is completed, S&P said.

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