S&P cuts MEPC to B+

Standard & Poor's said it lowered its long-term corporate credit and senior unsecured debt ratings on U.K.-based property investment company MEPC Ltd. to B+ from BB- as a result of the company's weakened financials.

At the same time, S&P lowered its preferred stock rating on MEPC International Capital LP, which is guaranteed on a subordinated basis by MEPC, to CCC+ from B-.

The outlook is negative.

"The downgrade on MEPC reflects the company's weakened financial profile, fewer income-producing assets in the portfolio, and an untested management," said S&P credit analyst Kenneth Mak.

S&P said MEPC benefits, however, from being controlled by a less aggressive owner, British Telecommunications plc (A-/positive/A-2) pension scheme, and the creditors benefit from liquidity provided by a £350 million four-year committed unsecured credit facility from BT pension scheme.

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