S&P cuts Crompton ratings

Standard & Poor's said it lowered the ratings on the existing senior notes and debentures of Crompton Corp. to B+ from BB-. The BB- corporate credit rating is affirmed, and the outlook remains negative.

S&P also assigned a B rating to proposed tranches of senior unsecured debt totaling $600 million with maturity dates of 2010, 2011, and 2014.

S&P also assigned a BB- bank loan rating and its 2 recovery rating to a new secured $250 million revolving credit facility maturing in 2009.

"The ratings on Crompton reflect the vulnerability of its operating margins and earnings to competitive pricing pressures, raw materials costs, and the cyclicality of its markets; and weak cash flow protection measures," said S&P credit analyst Wesley E. Chinn.

S&P said the ratings also incorporate the company's sizable unfunded pension and retirement medical benefit obligations and rubber chemicals litigation. These aspects are somewhat tempered by an array of complementary specialty and industrial chemical products, substantial geographic diversity of sales (roughly 50% of sales are outside the United States), improved liquidity, and a manageable debt maturity schedule.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.