S&P puts ATI Acquisition on watch

Standard & Poor's said it placed the B corporate credit rating on ATI Acquisition Co. on CreditWatch with negative implications.

"The CreditWatch listing reflects the potential impact of increased federal government regulation, which would negatively affect ATI's operating performance, debt leverage and liquidity," S&P analyst Hal Diamond said in a statement.

Including ATI's off-balance-sheet operating lease commitments and contingent payments, debt leverage declined slightly, to 4.5 times for the 12 months ended June 30, from roughly 5 times at the time of the company's December 2009 leveraged buyout.

ATI's leverage of 3.08 times as of June 30, calculated per covenants under the company's bank facilities, provides a 28% cushion against the leverage covenant of 4.25 times, which steps down to 4 times at Dec. 31, 3.75x at June 30 and 3.5x at Dec. 31, 2011.

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