S&P drops Alliant Resources view to negative

Standard & Poor's said it revised its outlook on B rated Alliant Resources Group Inc. to negative from stable.

S&P said the revised outlook reflects recent developments in an ongoing investigation by the office of the New York State attorney general into the payment of contingent commissions, which has led various insurance companies and insurance brokers to end certain compensation agreements.

On July 29, S&P assigned its B counterparty credit and bank loan ratings to Alliant. At that time, S&P noted the company's very limited track record, very weak capitalization, and the reliance on cash flow in the near term to rebuild equity.

S&P said the prospective loss of contingent commission income will affect the company's ability to generate free cash flow in the near to intermediate term. However, the company is expected to remain in compliance with its restrictive debt covenants.

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