S&P downgrades Hoover

S&P said it lowered Hoover Group Inc.'s issuer credit rating to CCC from B-, along with the rating on its first-lien credit facilities to CCC from B-.

The recovery rating remains at 3, indicating 65% expected default recovery.

Hoover's $30 million revolving credit facility matures in January 2020 and S&P said it believes internally generated liquidity will not be sufficient to repay the revolver when it comes due.

The company's first- and second-lien term loans are due in January and October 2021, respectively, the agency said.

S&P said it does not expect the first-lien term loan to be refinanced before it becomes current, given the challenging capital market conditions for companies exposed to the oil and gas sector.

The outlook is negative, reflecting a view that the company is vulnerable to a payment default over the next six to 12 months and because of increasing risks of a loan modification that will be considered a distressed restructuring and akin to default, the agency said.

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