S&P rates Farley's B, loan B+

Standard & Poor's said that it assigned a preliminary B corporate credit rating to Farley's & Sathers Candy Co. Inc. and a preliminary B+ issue-level ratings to its proposed $60 million revolving credit facility due 2016 and $185 million term loan B due 2018.

The preliminary recovery rating is 2, indicating the expectation of substantial (70% to 90%) recovery in the event of a payment default.

The company will use proceeds to refinance existing debt, including a revolving credit facility and first-lien term loan due June 15 and a second-lien term loan due Dec. 31, 2011.

The ratings reflect the company's vulnerable business profile and highly leveraged financial profile, given the company's narrow product focus, limited international presence and high debt leverage, the agency said.

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