S&P lowers Solo Cup

Standard & Poor's said it lowered all its ratings on Solo Cup Co. by two notches, including its corporate credit rating to CCC+ and removed them from CreditWatch where they had been placed with negative implications on Aug. 18.

The outlook is negative.

The agency said that the downgrade was prompted by significantly weaker-than-expected earnings, cash flow and liquidity as well as concerns about the company's ability to absorb additional raw material cost volatility and to obtain further financial covenant relief or restructure its debt.

Based on these factors, the agency added it now believes that meaningful operating and capital structure improvements will have to be achieved to reduce the risk of a default within the next year.

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