S&P rates TransDigm loan B

S&P said it assigned a B rating and 3 recovery rating to TransDigm Inc.'s proposed $1.228 billion term loan due 2024.

The 3 recovery rating indicates 50% to 70% expected default recovery.

The agency also said it affirmed the B rating on the company's secured debt. The 3 recovery rating is unchanged, indicating 50% to 70% expected default recovery.

S&P also said it affirmed the CCC+ rating on TransDigm's subordinated notes. The 6 recovery rating is unchanged, indicating 0 to 10% expected default recovery.

The proceeds of the new term loan will be used to repay a similarly sized first-lien term loan C due 2020, the agency said.

The refinancing will extend the company's maturities and somewhat reduce its interest expense due to the likely lower coupon on the new debt, S&P said.

The ratings reflect the company's above-average profit margins, leading positions in the niche markets for engineered aircraft components, good product diversity, weak credit metrics and high leverage, the agency said.

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