S&P changes Hillman to stable

S&P said it affirmed the B corporate credit rating on Hillman Group Inc. and revised the outlook to stable from negative.

At the same time, the agency affirmed the B+ ratings on Hillman's $550 million senior secured term loan due June 2021 and the $70 million revolving facility due June 2019. The recovery ratings remain 2, indicating a belief that lenders could expect substantial (70% to 90%, rounded estimate 75%) recovery in the event of payment default or bankruptcy.

S&P also affirmed the issue-level rating on the $330 million senior unsecured notes due July 2022 at CCC+. The recovery rating remains 6, indicating the belief that lenders could expect negligible (0% to 10%, rounded estimate 0%) recovery.

The agency estimates the company has about $1 billion of adjusted debt obligations (adjustments include capitalized operating leases and the company's trust preferred securities).

"The revision of the outlook to stable from negative reflects our expectation that the company will reduce debt leverage to near 7x by the end of 2017," S&P credit analyst Stephanie Harter said in a news release.

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