S&P cuts OPTI

Standard & Poor's said it lowered the long-term corporate credit rating on OPTI Canada Inc. to D from SD following the company's announcement that it intends to file for court protection under Canada's Companies' Creditors Arrangement Act.

S&P also lowered the senior secured debt ratings on the company's C$190 million revolver and $825 million first-lien debt to D from CCC+.

Although the existing interest reserve account remains sufficient to fund the first-lien debt interest payments until maturity, the ratings criteria place greater emphasis on the potential implications of insolvency proceedings, which can provide uncertainty as to whether the interest reserve account will remain isolated from OPTI's other assets, the agency said.

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