S&P drops Constellium, gives B to bonds

Standard & Poor's said it lowered its long-term corporate credit rating on Constellium NV to B from BB-.

The outlook is stable.

At the same time, the agency lowered the issue ratings on Constellium's €300 million senior unsecured bonds maturing 2021 and $400 million senior unsecured bonds maturing 2024 to B from BB-. The recovery ratings on the bonds remain 4.

S&P also assigned a B issue rating with a recovery rating of 4 to the proposed euro- and dollar-denominated senior unsecured bonds totaling €535 million equivalent, maturing in 2022.

S&P said the downgrade reflects Constellium's materially increased leverage following the fully debt-funded acquisition of U.S.-based aluminum can sheet producer Wise Metals for an enterprise value of $1.4 billion. The transaction has received all necessary approvals and is set to close at the beginning of January.

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