S&P cuts United Subcontractors

Standard & Poor's said it lowered the corporate credit rating on United Subcontractors Inc. to D from CCC- and its issue-level ratings to D and revised the recovery rating on the $295 million senior secured term loan to 6 from 5. The recovery rating on the $65 million second-lien term loan remains at 6.

"The lowering of the corporate credit rating and issue-level ratings follows USI's announcement that the company has filed voluntary petitions for reorganization under Chapter 11 in the U.S. Bankruptcy Court and that the company has reached an agreement with lenders related to its first- and second-lien loans," S&P analyst Thomas Nadramia said in a statement.

"The preplanned reorganization allows USI to convert $314 million of its debt to equity in the business, leaving approximately $22.5 million in debt when reorganization is complete."

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