S&P rates Herff Jones loans BB+

Standard & Poor's said it assigned the BB+ corporate credit rating to Herff Jones Inc. and BB+ ratings to its proposed $735 million senior secured credit facility, consisting of a $100 million five-year revolving credit facility, a $210 million five-year term loan A and a $425 million seven-year term loan B with 3 recovery rating.

The outlook is stable.

Proceeds will be used to help fund the acquisition of American Achievement Group Holding Corp.

According to S&P, the BB+ corporate credit rating reflects integration risks, exposure to variability in raw material costs and expectation for sizable annual employee stock ownership plan repurchase obligations.

These factors are tempered by strong industry dynamics, expectation for cash flow stability, consolidation of two industry leaders and modest debt leverage at slightly more than 3 times after closing, the agency said.

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