S&P downgrades American Greetings notes to B-

Standard & Poor's said it affirmed the B+ corporate credit rating on American Greetings Corp. and removed all ratings from CreditWatch following the completion Aug 9 of the merger between American Greetings and Century Intermediate Holding Co.

The agency said it initially placed the ratings on CreditWatch with negative implications in September following news that the company received a "going private" offer.

Subsequently, the agency lowered in April the company's corporate credit rating to B+ from BB+ following news that company would merge with Century Intermediate Holding Co., and all ratings remained on CreditWatch with negative implications.

The outlook is stable.

S&P also said it revised the recovery rating on the company's $225 million 7 3/8% senior unsecured notes due 2021 to 6, indicating 0% to 10% expected default recovery, from 4, which indicated 30% to 50% expected recovery. The agency also said it lowered the rating on this debt to B- from B+.

The downgrade reflects the increase in priority obligations as a result of this refinancing, S&P said.

The agency also said it lowered the preliminary rating on the company's senior unsecured shelf to B- from B+.

The ratings on the company's $600 million senior secured credit facilities, consisting of $250 million revolving credit facility due 2018 and $350 million term loan due 2019, is unchanged at BB-. The recovery rating on this debt is 2, indicating 70% to 90% expected default recovery.

© 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.