S&P: Canyon loans B+, CCC+

Standard & Poor’s said it assigned a B corporate credit rating to Canyon Cos. Sarl.

The agency also said it assigned a B+ rating to the company’s credit facilities, which are issued by borrowing entity GTCR Valor Cos. Inc., an indirect wholly-owned subsidiary of Canyon.

The $350 million first-lien senior secured credit facilities consist of a $25 million revolver, $185 million term loan and $140 million delayed-draw term loan. The recovery rating is 2, indicating 70% to 90% expected default recovery.

S&P also said it assigned a CCC+ rating to the company’s proposed $75 million second-lien term loan and $40 million second-lien delayed-draw term loan. The recovery rating is 6, indicating 0 to 10% expected default recovery.

The outlook is stable.

The proceeds will be used to fund in part the buyout of the two companies, S&P said.

The ratings reflect the company’s weak business risk profile and modest position in a narrow and fragmented end market, the agency said.

The ratings also consider its highly leveraged financial risk profile, S&P said.

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