S&P ups Rock-Tenn notes to BB+

Standard & Poor's said it raised Rock-Tenn Co.'s existing senior secured notes to BB+, the same level as the corporate credit rating, from BB and revised the recovery rating to 4 from 5.

The outlook is stable.

The higher rating and recovery expectation reflect the repayment of the company's outstanding industrial revenue bonds and the resulting additional collateral that benefits secured noteholders in the event of a default, according to the agency.

Ratings reflect competitive end markets, volatile raw material costs and aggressive financial leverage following the acquisition of Southern Container Corp. in March 2008, the agency said.

Forward integration, improved operating margins and relatively stable cash flow generation support the ratings, the agency noted.

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