S&P: Kellwood still on watch

Standard & Poor's said its ratings on Kellwood Co. (BB- corporate credit rating) would remain on CreditWatch, where they were placed with negative implications on Sept. 19.

This follows Kellwood's announcement that it will sell its Smart Shirts manufacturing operations and related real estate assets in two separate transactions.

Proceeds are expected to be used to pay down debt and repurchase shares.

The initial CreditWatch listing followed Kellwood's receipt of an unsolicited bid from Sun Capital Securities Group LLC to buy the company. Ratings were lowered on Oct. 17, reflecting weak underlying business trends and the tougher operating environment at retail, as well as weakening credit protection measures, S&P said.

Although Kellwood subsequently rejected Sun Capital's bid, the ratings remain on CreditWatch, the agency said.

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