S&P rates RPM International notes BBB

S&P said it assigned a BBB rating to RPM International Inc.'s proposed senior unsecured notes.

The agency also said it affirmed all of the company's existing ratings, including its BBB issuer credit rating.

RPM is issuing $350 million of senior unsecured notes to repay the outstanding borrowings under its revolving credit facility and for general corporate purposes, S&P said.

The stable outlook reflects an expectation that the company's credit measures will improve from their depressed levels in fiscal year 2019 due, in large part, to the expected savings from its cost-reduction initiatives and improved selling prices to offset persistent cost inflation, the agency said.

The company's EBITDA will increase significantly in fiscal year 2020 despite the current headwinds facing its business, which will depress its credit measures in fiscal year 2019, S&P said.

This improvement will be driven by the company's 2020 Margin Acceleration Plan (MAP), which was unveiled at its November 2018 investor day, the agency said.

The company generates the majority of its revenue from maintenance, repair and renovation projects, which imparts a level of stability to its EBITDA, S&P said.

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