Carpenter Technology Corp.'s Proposed $300 Million Senior Unsecured Notes Due 2030 Rated 'BB+' (Recovery Rating: '3')

NEW YORK (S&P Global Ratings) March 9, 2022--S&P Global Ratings today assigned its 'BB+' issue-level rating and '3' recovery rating to U.S.-based specialty alloys producer Carpenter Technology Corp.'s proposed $300 million senior unsecured notes due 2030. The '3' recovery rating indicates our expectation for average (50%-70%; rounded estimate: 65%) recovery in the event of a payment default. The company plans to use the proceeds from the proposed notes to refinance its $300 million senior notes due March 2023. For the complete issuer credit rating rationale, please see our most recent research update on Carpenter, published Feb. 15, 2022, on RatingsDirect. ISSUE RATINGS--RECOVERY ANALYSIS Key analytical factors The company's capital structure comprises a $300 million secured credit facility (not rated), $400

...- EBITDA at emergence: $150 million - Implied enterprise value multiple: 5.5x - Gross enterprise value: $825 million Simplified waterfall - Net enterprise value (after 5% administrative cost): $785 million - Priority claims (ABL revolving facility): $185 million - Value available for unsecured claims: $600 million - Estimated senior unsecured notes claim: $720 million - --Recovery expectations: 50%-70% (rounded estimate: 65%) Note: All debt amounts at default include six months of accrued prepetition interest....

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