S&P affirms CPG Intermediate

S&P said it assigned its B issuer credit rating to CPG Intermediate LLC. The outlook is stable.

At the same time, S&P affirmed and subsequently withdrew its B issuer credit rating on CPG Transaction LLC.

S&P also affirmed its B issue-level rating on CPG Intermediate LLC's first-lien credit facilities, which comprises an $85 million revolving credit facility and a $475 million first-lien term loan. The 3 recovery rating remains unchanged, indicating an expectation for meaningful (50%-70%; rounded estimate: 65%) recovery in the event of a payment default.

Additionally, S&P affirmed its CCC+ issue-level rating on the company's $135 million second-lien term loan. The 6 recovery rating remains unchanged, indicating an expectation for negligible (0%-10%; rounded estimate: 0%) recovery in the event of a payment default. The borrowers of this debt are IPS Intermediate Holdings Corp., IPS Structural Adhesives Holdings Inc. and Encapsys LLC, all of which are subsidiaries of CPG Intermediate LLC.

“Our rating on CPG Intermediate LLC (CPG) reflects the company's niche markets and limited applications in generally competitive product markets, such as those for structural adhesives and plumbing products. CPG also has production concentration in a single site that generates a meaningful portion of its revenue and the company faces some customer concentration as one of its customers accounts for a significant amount of its sales,” S&P said in a news release.

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