S&P rates Quintiles loan BB-

Standard & Poor's said it assigned a BB- rating to Quintiles Transnational Corp.'s proposed $175 million incremental term loan due 2018 with a recovery rating of 4, indicating 30% to 50% expected recovery in a default.

The proceeds, along with $75 million of cash, will be used to pay a $246 million shareholder distribution and fees associated with the term loan.

S&P also said it affirmed the BB- corporate credit rating on operating subsidiary Quintiles Transnational Corp., along with the BB- rating with 4 recovery rating on its existing senior secured debt. The 4 recovery rating indicates 30% to 50% expected recovery.

The agency also affirmed the holding company's term loan at B with a recovery rating of 6, which indicates 0 to 10% expected recovery.

The ratings reflect the company's aggressive financial policy, characterized by pro forma lease-adjusted debt-to-EBITDA slightly above 5x and a shareholder-friendly financial policy that resulted in two debt-financed dividends this year, S&P said.

The ratings also consider its satisfactory business risk profile, supported by the company's industry-leading market position in the growing contract research industry, the agency said.

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