S&P rates Arconic BB, loan BB+

S&P it assigned Arconic Corp. a BB following the company’s separation from parent Arconic Inc.

The agency also assigned a BB+ issue-level rating with a 2 recovery rating to Arconic's proposed senior secured term loan B, indicating an expectation of high recovery (70%-90%; rounded estimate: 75%).

“We expect that Arconic will generate fully adjusted debt to EBITDA of 3x-3.5x once it completes a year of stand-alone operation, which should provide good cushion at the current rating for profit risks in aerospace because of the Boeing 737 Max, as well as potential pressure in key automotive and construction sectors,” the agency said in a news release.

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