S&P affirms C&S notes

Standard & Poor's said it affirmed its BB- senior-secured debt ratings on C&S Group Enterprises LLC's $300 million of 8 3/8% senior secured notes due 2017 following the upsizing of the note issue by $50 million.

At the same time, the agency added that the 4 recovery rating remains the same.

These notes are guaranteed by C&S Wholesale Grocers, GU Markets LLC, ES3 LLC, Surry Licensing LLC, and Warehouse Technologies LLC, according to the agency, which added that proceeds are expected to be used for repaying borrowings under the parent company, C&S Wholesale Grocers Inc., and other related entities senior secured asset-based revolving credit facility.

"The speculative-grade rating on privately owned C&S Wholesale Grocers reflects the company's position as one of the leading wholesale grocery distributors, characteristically thin margins, significant customer concentration, some seasonality to quarterly operating results, high debt leverage, and moderate cash flow protection measures. This is partially offset by its fairly low cost operating position and an experienced management team," said S&P credit analyst Jayne Ross.

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