S&P rates Ryerson notes B-, view positive

S&P said it revised the outlook on Ryerson Holding Corp. and its subsidiary Ryerson Inc. to positive from stable and affirmed the B- corporate credit ratings.

At the same time, the agency assigned its B- issue-level rating and 4 recovery rating to the company's proposed $650 million senior secured notes, with proceeds expected to be used for debt reduction. The 4 recovery rating indicates average (30%-50%; upper end of range) recovery in the event of a default.

S&P also affirmed the CCC issue-level rating on the company's senior unsecured notes. The recovery rating on the notes remains 6, indicating an expectation of negligible (0%-10%) recovery in the event of a default.

"The positive outlook reflects our expectation that demand from Ryerson's various end markets will gradually improve in the next 12 months based on healthier general macroeconomic growth," S&P credit analyst William Ferara said in a news release.

"We expect Ryerson's key credit metrics could further improve in 2016, with debt to EBITDA of about 6.5x. We still, however, expect Ryerson to continue facing competitive pressures domestically and from foreign imports."

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