S&P lowers Big River view to stable

S&P said it revised the outlook on Big River Steel LLC to stable from positive and affirmed the B issuer credit rating.

The agency also assigned a B rating to the proposed $487 million of tax-exempt revenue bonds.

S&P also said it affirmed the B rating on the company's $400 million term loan B due in 2023 and $600 million senior secured notes due in 2025.

The recovery ratings are 3.

Big River's roughly $700 million phase II expansion of its electric-arc furnace steel mill will double capacity, S&P said.

The agency said it expects the company's leverage to remain elevated during construction due to the expected increase in debt, with adjusted debt-to-EBITDA ratio of about 7x in 2019, modestly declining to about 6x in 2020.

The stable outlook reflects our view that BRS' credit metrics will remain elevated but in line with the current rating over the next 12 months, with adjusted leverage of about 6x-7x in 2019-2020 due to higher debt associated with its capacity expansion.

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