S&P might drop AM General

Standard & Poor's said it placed its ratings, including the B corporate credit rating, on AM General LLC on CreditWatch with negative implications.

The CreditWatch placement is a result of AM General's weaker-than-expected liquidity profile following the release of third-quarter financials (which are not public).

"Free cash flow generation has been weaker than we expected, which has resulted in lower-than-expected cash balances," S&P credit analyst Chris Mooney said in a news release. In addition, covenant cushion is less than the 10% threshold associated with an "adequate" liquidity designation under the agency's criteria.

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