S&P rates Osmose loans B, CCC+

Standard & Poor’s said it assigned a B corporate credit rating to Osmose Utilities Services Inc., a subsidiary of OHI Intermediate Holdings Inc.

The agency also said it assigned B ratings and 3 recovery ratings on Osmose’s proposed $45 million senior secured revolver due 2020 and $275 million first-lien term loan due 2022.

The 3 recovery rating indicates 50% to 70% expected default recovery.

S&P also said it assigned a CCC+ rating and 6 recovery rating to the company’s proposed $115 million second-lien term loan due 2023.

The 6 recovery rating indicates 0 to 10% expected default recovery.

The outlook is stable.

The ratings reflect the company’s good market position as the largest provider of structural integrity services for utility transmission and distribution infrastructure and its above-average profitability, S&P said.

These factors are partly offset by the company’s high debt leverage, which is expected to remain more than 5x after it is acquired by private-equity firm Kohlberg & Co., the agency said.

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