S&P drops Office Depot

Standard & Poor's said it lowered its ratings on Office Depot Inc., including its corporate credit rating, to BB- from BB.

The agency said it also lowered the rating on the company's $400 million of senior unsecured notes due 2013 to B+ from BB-, adding that the recovery rating on these notes remains unchanged at 5.

The outlook is negative.

"The rating change," said S&P credit analyst Mark Salierno, "is based on its expectation that deteriorating macroeconomic conditions and the continued slowdown in consumer and corporate spending will lead to further near-term erosion in operating performance within the company's North American Retail Division and Business Solutions Division through the fourth quarter of 2008 and into fiscal 2009."

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