S&P rates Rough Country loan B

S&P said it assigned a B corporate credit rating to Rough Country LLC.

The outlook is stable.

The agency also said it assigned a B rating and 3 recovery rating to the company's proposed $205 million first-lien term loan due 2023 and $20 million revolver due 2022.

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

The ratings reflect the company's highly leveraged balance sheet and a belief that the company is a niche participant in the broader auto supplier market, S&P said.

The ratings also consider the discretionary nature of the company's products, which require Rough Country to successfully adapt to changes in consumer preferences to stay competitive, the agency said.

The stable outlook reflects an expectation that the company will continue to maintain above-average EBITDA margins, allowing it to generate a free operating cash flow-to-debt ratio of 4% to 6%, S&P said.

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