Research Update: Baffinland Iron Mines Corp. Affirmed At 'B-', Outlook Stable; Proposed US$550M Debt Rated 'B-' (Recovery Rating '4')

Baffinland Iron Mines Corp. is proposing to issue US$550 million of senior secured notes due 2026, with proceeds used primarily to retire US$350 million in existing notes and the balance used for general corporate purposes. We are assigning our 'B-' issue-level rating and '4' recovery rating to the proposed notes. We expect net proceeds will provide an additional liquidity cushion to support existing operations and capital-intensive growth initiatives, with modest impact on adjusted leverage. As a result, we are affirming our 'B-' long-term corporate credit rating on the company. The stable outlook on Baffinland primarily reflects S&P Global Ratings' expectation that the company will generate adjusted debt-to-EBITDA in the 4x-5x range in 2018 and 2019 amid a period of elevated

...+ Baffinland Iron Mines Corp. is proposing to issue US$550 million of senior secured notes due 2026, with proceeds used primarily to retire US$350 million in existing notes and the balance used for general corporate purposes. + We are assigning our 'B-' issue-level rating and '4' recovery rating to the proposed notes. + We expect net proceeds will provide an additional liquidity cushion to support existing operations and capital-intensive growth initiatives, with modest impact on adjusted leverage. + As a result, we are affirming our 'B-' long-term corporate credit rating on the company. + The stable outlook on Baffinland primarily reflects S&P Global Ratings' expectation that the company will generate adjusted debt-to-EBITDA in the 4x-5x range in 2018 and 2019 amid a period of elevated capital spending....

Research Update