S&P may cut Grant Forest

Standard & Poor's said it placed Grant Forest Products Inc.'s B- long-term corporate credit rating on CreditWatch with negative implications.

S&P said the watch reflects expectations that Grant's profitability and cash flow generation will be weaker than expected in 2008 due to industry conditions.

The agency said it was concerned that Grant's liquidity could come under pressure.

Although the company had a large cash balance at Sept. 30, weak cash flow generation, heavy interest costs due to its large debt burden and remaining capital expenditures at the Clarendon and Allendale mills will consume considerable liquidity in 2008, the agency added.

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