S&P changes Schmolz + Bickenbach view

S&P said it revised its outlook on Schmolz + Bickenbach AG to negative from stable and affirmed the B+ long-term corporate credit rating on the company.

At the same time, the agency affirmed the B+ issue-level rating on the €200 million senior secured notes due 2022 issued by Schmolz + Bickenbach Luxembourg Finance SA.

The recovery rating is 4, indicating an expectation for average recovery (30%-50%; rounded estimate: 35%) in the event of a payment default.

S&P said the revision of the outlook reflects the possibility that following the company’s acquisition of most of Asco Industries' plants, Schmolz + Bickenbach’s leverage could increase to about 5x in 2018 compared with the agency’s target of about 4x for the rating.

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