Fitch: HRG view to negative

Fitch Ratings said it affirmed the long-term issuer default rating of HRG Group, Inc. at B and revised the outlook to negative from stable.

Fitch also said it affirmed the ratings on HRG's senior secured and senior unsecured debt.

The outlook revision is driven by weakening upstream dividend coverage of holding company interest expenses, reduced diversification of HRG's portfolio following the expected sale of its interest in Fidelity & Guaranty Life Holdings, Inc. to Anbang Insurance Group Co., Ltd. later this year, the agency said.

The ratings are supported by the credit-risk profile and underlying diversity of HRG's largest investment, Spectrum Brands, Inc., which adds a degree of stability to HRG's upstream dividend flows, Fitch said.

The ratings also consider HRG's strong liquidity position, which is expected to improve further following the Fidelity sale to Anbang, the agency said.

The ratings also incorporate an expectation of potential de-leveraging following the close of the Fidelity & Guaranty investment sale, Fitch said.

Rating constraints include the potential for opportunistic acquisitions or other activities, which could alter HRG's risk profile, as well as the concentrated and less liquid nature of HRG's investments, the agency said.

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