S&P rates Contech loan BB-

Standard & Poor's said it assigned a preliminary B corporate credit rating to Contech Holdings Inc.

The agency also said it assigned a preliminary BB- rating to Contech Engineered Solutions LLC's proposed $150 million senior secured term loan B due 2019.

The preliminary recovery rating is 1, indicating 90% to 100% expected default recovery.

The outlook is stable.

The ratings reflect the combination of its weak business risk profile and highly leveraged financial risk profile, S&P said.

The stable outlook reflects an expectation of improved operating performance, driven by recovering residential and commercial construction spending, the agency said.

As a result, S&P said it expects Contech to generate positive free cash flow that will go toward repayment of debt, S&P said.

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