S&P cuts Yell outlook to negative

Standard & Poor's said it revised to negative from stable the outlook on Yell Group plc.

At the same time, the BB- corporate credit rating was affirmed, the agency said, adding that the outlook revision reflects its concerns that the current economic slowdown in the group's main markets, coupled with sustained competition in the United Kingdom and United States, could negatively affect the group's operating performance in the fiscal year ending in March 2009 and may therefore result in modest deleveraging and tight covenant headroom.

S&P noted that the ratings on Yell continue to primarily reflect the group's highly leveraged capital structure, mainly due to the July 2006 acquisition of Spanish directory leader Telefonica Publicidad e Informacion SA.

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