S&P rates Rock-Tenn loan recovery 4

Standard & Poor's said it assigned its 4 recovery rating to the $700 million senior secured credit facility of Rock-Tenn Co. (BB/negative/--). The facility includes a $450 million senior secured revolver due 2010 and a $250 million senior secured term loan due 2010.

S&P said the ratings on Rock-Tenn, a leading folding carton and paperboard manufacturer, reflect modest and declining operating margins and aggressive financial leverage following the acquisition of unrated Gulf States Paper Corp.'s pulp, paperboard and packaging businesses on June 6.

Ratings also reflect benefits from forward integration and relatively stable cash flow generation, the agency said.

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