S&P rates Alcoa Upstream, notes BB-

S&P said it assigned its BB- corporate credit rating to Alcoa Upstream Corp.

The outlook is stable.

At the same time, the agency assigned its BB- issue-level rating and 3 recovery rating to the company's proposed $1 billion senior unsecured notes. The 3 recovery rating indicates an expectation for meaningful (50%-70%; lower half of the range) recovery in the event of a payment default.

S&P’s recovery analysis, and resultant BB- issue-level rating on the proposed $1 billion senior unsecured notes, assumes a capital structure that includes a $1.5 billion senior secured revolving credit facility, which the agency expects to rate once supporting documentation is provided.

Alcoa Inc. is splitting its upstream and downstream businesses into two separate entities named Alcoa Upstream and Arconic, respectively.

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