S&P may lift Matria Healthcare

Standard & Poor's said it placed its ratings on Matria Healthcare Inc., including the B+ corporate credit rating and BB- senior secured bank loan rating, on CreditWatch with positive implications.

The CreditWatch placement follows the company's announcement that all its outstanding 4.875% convertible senior subordinated notes due 2024 were converted into Matria common stock. As a result, the company has essentially no debt outstanding.

Matria does have an undrawn $35 million senior secured revolving credit facility due October 2005.

Matria Healthcare is a disease-state management and fulfillment services provider to patients, physicians, and health plans. While the company's current capital structure might suggest a higher rating, its relatively small size creates the possibility that a business or financial transaction of only moderate proportions could dramatically affect its credit risk, S&P said.

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