S&P lowers Centro ratings
By a staff reporter - from Business Spectator
Standard & Poor's Ratings Services has lowered its issuer credit rating on Centro to 'CCC+' from 'BB+' and its senior-unsecured debt and preferred stock ratings to 'CCC+' and 'CCC-', respectively, from 'BB+' and 'BB-'.
According to the ratings agency, the downgrades reflect the potential for the group's assets to be sold in softening market conditions, particularly in the US. The downgrade also reflects changes to Centro's revolving credit facility, which now links default at Centro to its affiliates, Standard & Poor's said. The February 15 deadline for roll-over of substantial debt facilities has also contributed to the downgrade
"These events substantially increase the near-term probability that Centro could be put into default by its creditors, notwithstanding that the operating assets remain of good quality," credit analyst Craig Parker said.
"Given the uncertainty and urgency facing the group, we believe that the issuer rating on Centro NP could move either up or down from ‘CCC+’," Standard & Poor's said in a statement.
Standard & Poor's said however that if Centro was able to present a strategic plan that satisfies the bank lenders and facilitates an extension of its debt facilities, ratings could be raised.
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