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S&P rates Wyle loans BB, notes B+
Standard & Poor's said it affirmed its B+ corporate credit rating on Wyle Holdings Inc. The agency also said it assigned a BB rating to it $115 million senior secured financing, composed of a $25 million revolving credit facility due 2015 and a $90 million term loan due 2016. The notes have a recovery rating of 1, indicating the expectation of 90% to 100% recovery in the event of default.
The agency also assigned a B+ rating to the company's new $175 million senior subordinated notes due 2018 with a recovery rating of 4, indicating the expectation for 30% to 50% recovery.
The company said it will use the proceeds to refinance existing indebtedness, S&P said.
The refinancing extends the company's debt maturity profile and reduces interest expense by about $5 million, the agency said.
The ratings reflect modest profitability inherent in the government services business, budget reliance on key U.S. federal government agencies and a leveraged financial profile, S&P said.
Solid positions in the niche government services market, as well as predictable revenue streams support the ratings, the agency said.
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