S&P: Supervalu on watch

Standard & Poor's said it placed the ratings on Supervalu Inc., including the B+ corporate credit rating, on CreditWatch with negative implications following news that management is reviewing strategic alternatives to enhance value for its shareholders, as well as lower-than-expected first-quarter results.

The CreditWatch listing reflects an opinion that a potential transaction to enhance shareholder value, which may include a sale of the company, could weaken its credit-protection measures, S&P said.

The agency said it expected debt leverage of mid-4x in fiscal 2013 given its debt-reduction efforts and despite sales pressure.

The ratings reflect its weak business risk profile and its aggressive financial risk profile, S&P said.

The agency said it expects liquidity to remain adequate based on the proposed refinancing transactions to extend debt maturities and eliminate financial covenants.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.