S&P could lower ETA

Standard & Poor's said it placed on CreditWatch with negative implications the long-term BBB- corporate credit rating on ETA Group and the BBB- rating on the $300 million senior unsecured bank loan due 2012 issued by subsidiaries Emirates Trading Agency LLC, ETA Star Holdings Ltd. and Associated Construction and Investments Co. LLC.

S&P said the actions are due to concerns over increasing financial leverage, the likely adverse effect of the continuing global economic slowdown on ETA's cyclical activities and low levels of headroom under financial covenants.

The watch is prompted by concerns that the global economic slowdown is now hurting ETA's main markets and the agency said it is concerned that this may lead to a drop in trading performance and a further deterioration of key credit ratios. Concerns also include the tight covenant position and the increasing pressure this may place on liquidity.

At Dec. 31, 2007, adjusted debt-to-EBITDA ratio was 5.2x.

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