S&P rates Community Health loans BB, notes B-

Standard & Poor's said it lowered Community Health Systems Inc.'s corporate credit rating to B+ from BB- and removed it from CreditWatch, where it were placed with negative implications on March 20 following the company's bid to buy Triad Hospitals Inc. for $6.8 billion.

S&P assigned a BB rating to Community Health's $7.2 billion senior secured credit facilities, consisting of a $750 million revolver due 2013, a $6.065 billion senior secured term loan B due 2014 and a $400 million delayed-draw term loan due 2014.

The agency assigned its B- rating to Community's $3 billion senior unsecured notes.

The outlook is stable.

The downgrade reflects the issuer's weakened financial risk profile after the financing the buyout of Triad, S&P said.

The company benefits from the company's diversified hospital portfolio and management's experience operating a large number of hospitals, the agency said.

The speculative grade rating on Community reflects the company's significant debt leverage as a result of its debt-financed acquisition of Triad Hospitals Inc. and industry challenges that the company faces, such as uncertain third-party reimbursement, increasing bad debt and relatively weak patient volume trends, the agency said.

The company also faces the risk of integrating a large hospital operation into its existing operation, S&P said.

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