S&P rates Molycorp convertibles CCC

Standard & Poor's said it assigned a CCC rating to Molycorp Inc.'s proposed convertible senior notes due 2018.

The recovery rating on the notes is 5, indicating 10% to 30% expected recovery in a default.

The convertible notes will be senior unsecured obligations and will rank equally to all of Molycorp's existing and future senior unsecured indebtedness.

The proceeds, along with net proceeds from a concurrent offering of common stock expected to generate at least $300 million, will be used to fund capital expenditures and other cash requirements for 2013, S&P said.

The CCC+ corporate credit rating and developing outlook reflects the company's vulnerable business risk profile and highly leveraged financial risk profile, the agency said.

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