S&P rates Aleris notes B; view to negative

Standard & Poor's said it revised the outlook on Aleris International Inc. to negative and affirmed its B+ corporate credit rating.

S&P also said it assigned a B rating to the company's proposed $400 million in senior unsecured notes due 2020. The recovery rating on the notes is 5, indicating 10% to 30% expected recovery in a default.

The agency also said it lowered the rating on its existing $500 million senior unsecured notes to B from B+ and revised the recovery rating on the notes to 5 from 4.

The ratings reflect the combination of the company's weak business risk profile and aggressive financial risk profile, S&P said.

These assessments consider the company's participation in the highly competitive aluminum industry, which is characterized by volatile pricing, competitive end markets and thin operating margins, the agency said.

Improving demand in the United States, solid global aerospace growth and adequate liquidity somewhat offset these factors, S&P said.

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