TEXT-S&P rates Alliant Techsystems term loan 'BBB-'
Aug 23 - Standard & Poor's Ratings Services said today that it assigned its 'BBB-' issue-level rating to Alliant Techsystems Inc.'s $200 million incremental secured term loan due 2017. Alliant intends to use the proceeds--plus cash on hand--to redeem $400 million of its 6.75% subordinated notes. We also assigned a '1' recovery rating to the debt, indicating our expectation for very high (90%-100%) recovery for lenders in the event of a payment default. The 'BB' corporate credit rating is unchanged. The outlook remains negative, reflecting risks to the company's government programs. The existing issue ratings are also unchanged. The addition to secured debt implies less value available for both the existing secured and subordinated creditors. However, the somewhat lower recovery for secured debt is still within the bounds of our high recovery category. With respect to the lower priority debt, we also see no meaningful change in the recovery prospects, given the anticipated offsetting reduction in the amount of such debt from Alliant's redemption of the 6.75% subordinated notes. For our full recovery analysis, see the recovery report to be published shortly on RatingsDirect. RELATED CRITERIA AND RESEARCH Alliant Techsystems Inc., June 15, 2012 RATINGS LIST Alliant Techsystems Inc. Corporate Credit Rating BB/Negative/-- New Rating Alliant Techsystems Inc. $200 mil secured term loan due 2017 BBB- Recovery Rating 1