S&P rates Dealer Tire CCR, loans B

Standard & Poor's said it assigned its B corporate credit rating to Dealer Tire LLC.

The outlook is stable.

At the same time, the agency assigned its B issue-level and 3 recovery ratings to the company's $615 million term loan and $100 million revolver. The 3 recovery rating indicates an expectation that debtholders would realize meaningful recovery (50%-70%) in the event of a payment default.

"The ratings reflect Standard & Poor's view that Dealer Tire's EBITDA margins and cash generation will be commensurate with our expectations of leverage at 5.0x and modest positive free operating cash flow (FOCF) prospects," S&P credit analyst Lawrence Orlowski said in a news release.

The agency views the company's liquidity as "adequate," based on its criteria.

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