OREANDA-NEWS. S&P Global Ratings said today it assigned its 'BB-' issue-level rating to Boise, Idaho-based wood product manufacturer and distributor Boise Cascade Co.'s proposed $300 million senior unsecured notes. The recovery rating is '3', reflecting our expectation of meaningful (50%-70%; at the lower half of the range) recovery in the event of default.

The company will use proceeds from the proposed transaction to redeem $300 million of its existing senior unsecured notes due 2020. The transaction will allow the company to extend the tenor of its capital structure and reduce interest expense. We expect that the company will maintain leverage below 4x throughout 2016, which is in line with the rating. The 'BB-' rating reflects the company's weak business risk and aggressive financial risk profile.

The 'BB-' corporate credit rating and stable outlook on Boise Cascade are unchanged. For our complete analysis, please see our research update published on Nov. 23, 2015, on RatingsDirect.