S&P rates Kerneos Corporate loan B+

S&P Global Ratings said it affirmed its B+ long-term credit rating on Kerneos Corporate SAS, a France-based producer of calcium aluminate cements. The outlook is stable.

At the same time, S&P assigned a B+ issue rating to the company's proposed €445 million floating-rate term loan, due 2023. The recovery rating on the loan is 3, indicating an expectation of average recovery, in the lower half of the 50%-70% range, in the event of a payment default.

S&P also affirmed the existing B+ issue ratings on the company's €375 million senior secured second-lien notes. The recovery rating on these notes is 4, indicating an expectation of average recovery, in the higher half of the 30%-50% range, in the event of a payment default. S&P said it plans to withdraw its issue-level and recovery ratings on the company's existing rated debt upon repayment.

The rating affirmation reflects S&P’s view that Kerneos will continue to gradually improve its profitability on the back of revenue growth in the building chemistry and bauxite producing business segments, low input prices, and ongoing cost optimization, and despite difficult market conditions in its refractory business, the agency said.

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