S&P gives Canyon Cos. loans B+, CCC+

Standard & Poor's said it assigned its B preliminary corporate credit rating to Canyon Cos. Sarl.

The outlook is stable.

At the same time, the agency assigned a preliminary B+ issue-level rating to the company's proposed credit facilities (the borrowing entity of which is GTCR Valor Cos. Inc., an indirect wholly owned subsidiary of Canyon).

The $350 million first-lien senior secured credit facilities consist of a $25 million revolver, $185 million term loan and $140 million delayed-draw term loan. The preliminary recovery rating is 2, indicating an expectation for substantial recovery (70%-90%) in the event of a payment default.

S&P is also assigning a preliminary CCC+ issue-level rating to the company's proposed $75 million second-lien term loan and $40 million second-lien delayed-draw term loan. The preliminary recovery rating is 6, indicating an expectation for negligible recovery (0%-10%) in the event of a payment default.

"The rating on Canyon reflects our assessment of the company's 'weak' business risk profile, based on our view of the combined entity's modest position in a narrow and fragmented end market," S&P credit analyst Martha Toll-Reed said in a news release.

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