S&P rates Remy loan B+, view to positive

Standard & Poor's said it affirmed the B+ corporate credit rating on Remy International Inc. and revised the outlook to positive from stable.

S&P also said it assigned a B+ rating and a 4 recovery rating, indicating 30% to 50% expected default recovery, to Remy's $325 million term loan.

Remy's credit metrics continue to improve, the agency said, which led to the outlook revision.

S&P said it believes commercial- and light-vehicle production in North America will be flat while Europe will be weak in 2013.

The projected weakness in Europe in 2013 stems in part from the ongoing consumer uncertainty in the economy, the agency said.

But the company's consistent free operating cash generation and declining leverage to 3x or below in 2014 reflect an improving financial risk profile that could support a higher rating, S&P said.

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