S&P rates EnergySolutions loans BB+, notes BB-

Standard & Poor's said it assigned a BB- corporate credit rating to EnergySolutions Inc., along with a preliminary BB+ issue-level rating and 1 recovery rating to the company's proposed $685 million credit facilities. The credit facilities are expected to consist of a $125 million revolving credit facility due 2015 and a $560 million term loan facility due 2016. The 1 recovery rating indicates an expectation of 90% to 100% recovery in a default.

The agency also said it assigned a preliminary BB- rating and 4 recovery rating to the company's proposed $300 million senior unsecured notes due 2018. The 4 recovery rating indicates an expectation of 30% to 50% recovery in a default.

The outlook is negative.

The ratings reflect the company's aggressive financial risk profile, marked by significant debt, along with the operational risks associated with participating in the highly regulated low-level radioactive waste industry, including competitive contract bidding, S&P said.

The company's leading market position in the specialized niche of nuclear waste services, limited competition in primary service areas, improved operating results and predictable free cash flow generation partially offset these factors, the agency said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.