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S&P cuts UCI Holdings loans, notes
Standard & Poor's said it lowered its corporate credit rating on UCI Holdings Ltd. to B- from B and revised the outlook to stable from negative.
At the same time, the agency lowered the issue-level rating on UCI's senior secured facility (revolver and term loan) to B from B+. The recovery rating remains at 2, which indicates substantial (70%-90%) recovery of principal in the event of a default.
S&P also lowered the issue-level rating on UCI's senior unsecured notes to CCC from CCC+. The recovery rating remains at 6, which indicates negligible (0%-10%) recovery of principal in the event of a default.
"The downgrade reflects credit measures and free cash flow that are weaker than our expectations for the 'B' rating," S&P credit analyst Robyn Shapiro said in a news release.
The rating on UCI reflects S&P's view of the automotive aftermarket company's business risk profile as "weak" and its financial risk profile as "highly leveraged," the agency said.
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