S&P assigns B- to Distribution International loan

Standard & Poor's said it assigned its preliminary B- corporate credit rating to Distribution International Inc. The outlook is stable.

At the same time, S&P assigned a preliminary B- issue-level rating to the company's proposed $200 million senior secured term loan due 2019. The preliminary recovery rating is 4, indicating an expectation of average (30% to 50%) recovery for lenders in the event of a payment default.

The company also has a new $80 million asset-based lending facility due 2018, which S&P does not rate.

"DI will use proceeds from the proposed offering to refinance $153 million of existing indebtedness, finance a planned acquisition for approximately $20 million, fund a special dividend to equity holders of approximately $40 million, and pay estimated fees and expenses in connection with the financing," said S&P credit analyst Maurice Austin in a news release.

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