S&P revises KNB Holdings view to negative

S&P said it revised its outlook on KNB Holdings Corp. to negative from stable.

At the same time, the agency affirmed all ratings, including the B issuer credit rating on the company and the B issue-level rating on its senior secured first-lien term loan. The recovery rating on the loan is 3, reflecting an expectation for meaningful (50%-70%; rounded estimate: 55%) recovery for the first-lien loan holders in a simulated default scenario.

“The negative outlook reflects the risk that we could lower the ratings over the next 12 months if performance deteriorates further, likely from lower margins stemming from the increase in tariffs,” S&P said in a news release.

“The negative outlook takes into account the uncertainty about the full extent of the impact of U.S. tariffs on goods imported from China, as well as the company's ability to mitigate the impact on margins through sales price increases or other productivity initiatives.”

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