S&P drops outlook on Southeast Georgia Health, rates bonds A

Standard & Poor's said it revised its outlook to negative from stable on debt issued by Glynn-Brunswick Memorial Hospital Authority for Southeast Georgia Health System and assigned its A rating to the $96.7 million series 2008A bonds.

The upcoming series 2008B bonds will be supported by a letter of credit from BB&T Bank and will likely carry a rating of A+/A-1, S&P said.

The downgraded outlook reflects "declining operating performance during the past several years, and unexpectedly soft operating results through the eight months of fiscal 2008 ended May 31," S&P said in a statement.

Southeast Georgia Health System will use series 2008A and 2008B bond proceeds to refund the $94 million outstanding series 2004A and 2004B bonds, fund a $7 million expansion of its maternity unit and a $12 million expansion of orthopedic services in its St. Simon's inpatient tower, purchase $13 million in equipment and renovate the recently purchased 204-bed skilled-nursing facility on the Brunswick campus.

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