S&P downgrades IPC

S&P said it lowered the issuer credit rating on IPC Corp. to CC from CCC+.

The agency also said it lowered the rating on IPC's second-lien debt to CC from CCC.

S&P said it placed the issuer credit rating and second-lien issue-level ratings on IPC on CreditWatch with negative implications.

The first-lien issue-level rating is unchanged because it is not subject to the distressed offer, the agency said.

IPC has announced a proposal to repurchase the existing second-lien indebtedness with a new first-lien last-lien out facility or a new 1.5-lien-facility, S&P said.

The agency said it believes that second-lien lenders could receive less than the original par amount, depending on participation levels, which would result in us assessing the repurchase as tantamount to default.

S&P said it intends to resolve the CreditWatch listing over the next two weeks once participation levels have been determined and the transaction closes.

The CreditWatch placement reflects uncertainty as to whether second-lien lenders would be paid at par or at a discount, the agency said.

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