S&P puts Smithfield Foods on positive watch

Standard & Poor's said it placed its ratings on Smithfield Foods Inc., including the BB- corporate credit rating, on CreditWatch with positive implications.

"The CreditWatch placement follows WH Group Ltd.'s (Smithfield's parent company) announcement that it is seeking to issue equity through an IPO on the Hong Kong Stock Exchange, with the mid-point of the indicative offer price range resulting in net proceeds of approximately $3.6 billion," said S&P credit analyst Chris Johnson in a news release.

"We expect the company to use net proceeds from the transaction for debt repayment. If net proceeds well exceed $4 billion and debt is repaid as currently envisioned, we believe this transaction could improve the group's financial risk profile and result in a higher group credit profile."

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