S&P downgrades Head

Standard & Poor's said it lowered to CC from CCC+ its long-term corporate credit rating on Head NV and its €111.6 million 8½% senior unsecured notes due February 2014, issued by HTM Sport und Freizeitgeraete AG, to C from CCC.

The outlook is negative.

The actions follow Head's announcement that it is inviting holders of its senior unsecured notes to exchange any and all of their notes for new euro-denominated secured notes maturing on the same date with a 10% coupon, according to the agency.

"We take the position that under our criteria this exchange offer is equivalent to a default, given that acceptance of the new notes would represent a substantial discount to the par amount of the outstanding issues," S&P analyst Diego Festa said in a statement.

In the 12 months to Dec. 31, Head's adjusted ratio of debt to EBITDA was 13.4x.

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