S&P rates FiberVisions loans B, CCC+

Standard & Poor's said it assigned a B corporate credit rating to FiberVisions Delaware Corp., a B rating with a recovery rating of 3 to the company's proposed $90 million first-lien senior secured credit facility and a CCC+ rating with a recovery rating of 5 to its proposed $20 million second-lien senior secured credit facility. The outlook is stable.

Transaction proceeds will be used to finance the acquisition of a 51% equity stake in FiberVisions by Snow, Phipps & Guggenheim LP, an affiliate of private equity firm SPG Partners LLC. Hercules Inc. (BB/stable), the current parent, will retain a 49% stake in the firm.

S&P said the ratings on FiberVisions reflect a vulnerable business risk profile with significant customer concentration and exposure to technology changes in the nonwoven segment, a highly leveraged financial position, a relatively narrow business focus and weak margins because of the company's participation in the fragmented and competitive staple fiber industry.

These factors are somewhat mitigated by the company's leading market share in staple fibers, some geographical diversification through plant locations on three continents and moderate end-market diversity, the agency said.

Pro forma for the refinancing, total debt to EBITDA will be about 4.7x.

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