S&P rates Jacuzzi B, loans B, CCC+

Standard & Poor's said it assigned its B corporate credit rating to Jacuzzi Corp.

The outlook is stable.

At the same time, S&P said it assigned its B bank loan rating and 3 recovery rating to Jacuzzi's proposed $135 million first-lien term loan and $15 million synthetic letter of credit facility.

In addition, the agency said it assigned our CCC+ bank loan rating and 5 recovery rating to Jacuzzi's proposed $185 million second-lien term loan and the 3 rating indicates the expectation of meaningful recovery of principal and the 5 indicates the likelihood of negligible recovery of principal in the event of a payment default.

S&P noted that the proceeds will be used, along with $115 million of equity to fund Apollo Management LP's $440 million acquisition of the bath products business of Jacuzzi Brands Inc. (B+/Watch negative).

According to the agency, the ratings on Jacuzzi reflect very competitive industry conditions, partly because of fragmented markets, industry cyclicality, the relatively narrow focus of the company's principal product lines, weak operating margins and a very aggressive debt load.

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