S&P drops Arias

Standard & Poor's said it lowered its counterparty credit and senior debt ratings on Arias Acquisitions Inc. to CCC+ from B- and lowered its subordinated debt rating to CCC- from CCC.

S&P said it then removed the ratings from CreditWatch with negative implications where they had been placed on Feb. 28.

The outlook is negative.

The removal from CreditWatch reflects Arias' success in renegotiating the financial covenants on its outstanding debt, thereby addressing the material concern that Arias would fall out of compliance with the financial covenants on its outstanding debt within the next 90 days, the agency said.

The downgrade and negative outlook reflects S&P's belief that the weakness of the new housing market -in combination with the ongoing challenge of restoring positive sales momentum in the commercial general liability business - will continue to adversely affect revenues, operating performance and cash-flow generation in the next several quarters.

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