S&P affirms KNEL

S&P said it affirmed its B corporate credit rating on KNEL Acquisition LLC and affirmed the B issue-level ratings on the company's $262.1 million A-1 senior secured first-lien term loans, from $180.1 million with the proposed add-on and amendment to the senior secured credit facilities.

The agency also affirmed the B issue-level ratings on the company's $111.8 million Canadian borrower A-2 first-lien term loans. The recovery ratings on the first-lien term loans and $65 million revolving credit facility due in 2019 are unchanged, indicating expectations of meaningful (50%-70%; rounded estimate: 55%) recovery in the event of a payment default.

S&P also affirmed the CCC+ issue-level ratings on the company's $73 million second-lien term loans ($38 million A-1, and $35 million A-2) due 2022. The 6 recovery rating indicates an expectation of negligible (0%-10%; rounded estimate: 0%) recovery.

The outlook is stable.

The company will use the add-on proceeds to fund the acquisition of a contract powder manufacturer.

“The ratings affirmation reflects our view that the acquisition will modestly strengthen KNEL's position in the contract powder-manufacturing industry,” the agency said in a news release.

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