S&P keeps TNS on negative watch

Standard & Poor's said TNS Inc.'s BB- corporate credit and senior secured debt ratings remain on CreditWatch with negative implications. The ratings were placed on CreditWatch March 14 following an announcement that TNS received a nonbinding proposal from members of senior management to acquire the outstanding shares of TNS for a cash price of $22 per share, or about $500 million.

The company recently announced that a special committee of the board of directors has rejected this offer. The company also announced that it has hired an investment bank to explore a range of strategic alternatives for the purpose of enhancing shareholder value.

S&P said the CreditWatch listing reflects continued uncertainty surrounding long-term plans for TNS's capital structure. While the company's current financial risk profile, including operating lease-adjusted total debt to EBITDA of about 2.2x, supports current ratings, shareholder initiatives appear to be a priority over the near term, and other acquisition offers may also be submitted.

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