S&P ups American Greetings

S&P said it raised its corporate credit rating on American Greetings Corp. to BB- from B+. The outlook is stable.

S&P also raised the issue-level rating on the company’s senior secured credit facility to BB+ from BB, the rating on the senior unsecured notes due 2021 to BB- from B+ and the issue-level rating on the company’s $285 million holding company PIK notes due 2019 to B from B-. The recovery ratings remain 1, 3 and 6, respectively, for these facilities/issues.

S&P said the upgrade reflects the company’s prepayment of an additional $65 million of debt in fiscal 2016, and S&P’s belief that American Greetings’ adjusted leverage will remain below 4x over the next year from steady adjusted EBITDA margin and excess cash flow directed toward debt repayment.

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