Moody's may still cut Wendy's

Moody's Investors Service said the ratings of Wendy's International Inc. remain on review for possible downgrade, following the company's disclosure in its most recent 10-Q filing that it does not intend to renew its $200 million revolving credit facility that expires on Sept. 1, 2008.

Although Wendy's decision not to renew its revolving credit facility will result in the elimination of a significant source of external liquidity, the combination of internally generated cash flow, a significant cash balance and no near term debt maturities is expected to provide adequate liquidity over the near term, the agency added.

According to Moody's, Wendy's ratings are currently on review for possible downgrade primarily as a result of both the company's continued weak operating performance and its pending merger agreement with Triarc Companies, Inc., which was announced on April 24.

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