S&P rates new Adaptec convertibles B-

Standard & Poor's said it affirmed its B+ corporate credit and B- subordinated debt ratings on Adaptec Inc. and assigned a B- rating to Adaptec's proposed $150 million offering of convertible senior subordinated notes due 2023.

The outlook is stable.

S&P said the ratings on Adaptec are based on limited growth prospects in the mature small computer systems interface business combined with slow uptake of next-generation Internet small computer systems interface interconnect technology and still-weak debt protection levels.

These factors are partially offset by a leading position in the company's served market and financial flexibility provided by a net cash position. Adaptec has a dominant share of the market for SCSI chips and adapter cards, which are used to connect high-performance peripherals to computer servers.

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