S&P cuts A&P

Standard & Poor's said it lowered its corporate credit rating on the Great Atlantic & Pacific Tea Co. Inc. to CCC+ from B-, along with its senior secured debt rating to CCC+ from B-.

The recovery rating remains at 4, indicating an expectation of 30% to 50% recovery in the event of default.

The agency also said it lowered the senior unsecured debt rating to CCC- from CCC, keeping the recovery rating at 6, indicating an expectation of 0% to 10% recovery in the event of a default.

S&P also said it lowered the rating on the convertible preferred stock to CC from CCC-. The agency also assigned a preliminary CCC+ senior secured debt rating and a preliminary CCC- senior unsecured and subordinated debt rating to the company's $500 million Rule 415 shelf filing.

The outlook is developing.

The rating reflects its highly leveraged capital structure, meaningful multiemployer pension liability, limited free cash flow generation and geographic concentration in the New York and New Jersey metropolitan area, S&P said.

The ratings also consider its participation in the highly competitive supermarket industry and continued weak supermarket performance, the agency said.

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