S&P cuts Washington Prime

S&P said it cut Washington Prime Group Inc.’s rating to D from CC and its preferred shares and unsecured debt to D from C.

The downgrades follow Washington Prime’s announcement it will not make the $23.2 million interest payment due Feb. 15, 2021, on its 6.45% senior notes in the 30-day grace period, S&P said.

“The failure to make this payment will lead to an event of default on March 17, 2021, which could trigger the cross-default provisions under each of the company's corporate credit facilities,” the agency said in a press release.

“While the owners of 67% of the principal amount of the company's notes have signed a forbearance agreement, which stipulates that they agree to forbear from exercising their rights related to the event of default until March 31, 2021, at the latest, we nevertheless view the non-payment of the interest on its senior notes as a default,” S&P said.

Washington Prime said it continues its talks with its lenders but said it might need to restructure under Chapter 11, the agency said.

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