S&P rates Acosta, loan B+

Standard & Poor's said that it assigned Acosta Inc. a preliminary B+ corporate credit rating.

The outlook is stable.

S&P also assigned the company's proposed $1.075 billion senior secured first-lien credit facility, which consists of a $985 million term loan and a $90 million revolving credit facility, a preliminary B+ rating with a 3 recovery rating, indicating the expectation of meaningful (50%-70%) recovery in the event of a payment default.

Proceeds from the term loan, $525 million of unrated notes and an equity investment will finance the purchase of the company, including the retirement of its current credit facility.

The ratings reflect the belief that Acosta will increase sales and profits in the near term, as consumer packaged good producers will increase outsourcing of sales and marketing functions, the agency said.

As a result of favorable industry dynamics, S&P views Acosta's business risk profile as fair, the agency added.

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