S&P gives Graphic Packaging notes BBB-

S&P said it gave its BBB- issue-level rating and 1 recovery rating to Graphic Packaging International LLC’s upcoming $400 million of senior secured notes due 2024 and $400 million of senior secured notes due 2026. The 1 recovery rating indicates an expectation for very high (90%-100%; rounded estimate: 95%) recovery in default.

Graphic Packaging intends to use the proceeds to repay all of the outstanding borrowings under its $660 million term loan, repay a portion of the borrowings under its $800 million term loan and pay fees and expenses it incurred in connection with the offering.

“We view the transaction as leverage neutral; thus, it does not affect our BB+ issuer credit rating or stable outlook on Graphic Packaging,” S&P said in a press release.

The agency also affirmed Graphic Packaging’s BB+ issue-level rating, the 4 recovery rating on the company’s unsecured notes is unchanged. The 4 rating indicates a forecast for average (30%-50%; rounded estimate: 30%) recovery in default.

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