Fitch may cut Old Republic

Fitch Ratings said it revised the Rating Watch status for Old Republic International Corp. to negative from positive, following the company's announcement to withdraw the spinoff of Republic Financial Indemnity Group, Inc.

The company has an issuer default rating of BB and $550 million 3.75% senior notes due March 15, 2018 rated BB-.

Fitch placed the ratings on Rating Watch positive on March 23 after the company's announced plan to spin off of its wholly owned subsidiary, RFIG.

The spinoff was withdrawn due to what management reported as 'objections raised by certain stakeholders,' according to the agency.

The spinoff would have mitigated the concern regarding a potential subsidiary collateral covenant breach under the company's debt obligations and eliminated any future cash drain related to RFIG, the agency noted.

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