S&P rates Esterline notes BB

Standard & Poor's said it assigned a BB rating to Esterline Technologies Corp.'s proposed $200 million senior unsecured notes due 2020, the same as the corporate credit rating on the company. The agency also said it assigned a 4 recovery rating to the notes, indicating an expectation for 30% to 50% recovery in a default.

The proceeds will be used to refinance the outstanding $175 million 7¾% subordinated notes due 2013, and the rating on those notes will be withdrawn once they are paid off.

The agency also said it affirmed the BB rating on Esterline's outstanding $175 million 6 5/8% senior notes due 2017. The recovery rating was revised to 4 from 3 due to the increased amount of debt at this level in the capital structure following the new issuance, S&P said.

The ratings reflect the company's exposure to the competitive and cyclical commercial aerospace market, an active acquisition program and modest size compared with some competitors, the agency said.

The company's diversified revenue base and moderate debt leverage partly offset these factors, S&P said.

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