S&P lowers DeCrane loan to CCC

Standard & Poor's said it lowered DeCrane Aerospace Inc.'s second-lien credit facility to CCC from B- and revised the recovery rating on the facility to 6 from 4.

The B- long-term corporate credit rating and the B+ senior secured debt rating with a recovery rating of 1 were affirmed.

The outlook was revised to negative from developing.

The lower rating on the facility reflects S&P's expectation that DeCrane's value and the amounts lenders would receive in the event of bankruptcy would be less than the agency had previously expected.

The agency said the outlook revision is based on lower demand for corporate aircraft - which S&P expects to constrain improvement in the company's highly leveraged financial risk profile - and S&P's concern about near-term covenant compliance.

The corporate credit rating reflects high debt, weak credit protection measures, the cyclical and competitive corporate aircraft supplier industry and the company's small scale of operations, S&P said.

DeCrane benefits from its leading position in niche markets for manufacturing corporate aircraft interiors and good operating profit margins from core operations, the agency added.

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