Fitch rates Rite Aid notes CCC/RR5

Fitch Ratings said it assigned a rating of CCC/RR5 to Rite Aid Corp.'s $481 million of guaranteed senior notes due 2020.

The issuer default rating is B-.

The outlook is negative.

Proceeds will be used to redeem the $460 million 9 3/8% guaranteed senior notes due 2015.

The ratings reflect Rite Aid's high leverage, limited capital for investment and operating statistics that significantly trail its two major competitors, the agency said.

The ratings also reflect the company's strong market share position as the third largest U.S. drug retailer and management's efforts to improve the productivity of its store base and manage liquidity through refinancing activity over the last two years, working capital reductions and other cost cutting initiatives, the agency noted.

The company has an adjusted debt to EBITDAR of 7.6 times.

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