S&P puts IFCO on watch

Standard & Poor's said it placed the BB- long-term corporate credit and debt ratings on IFCO Systems NV on CreditWatch with negative implications.

"The CreditWatch placement reflects our heightened concerns over the company's weakened liquidity since the beginning of the year, mainly because extraordinary cash drawings have diminished availability under the revolving credit facility," S&P analyst Izabela Listowska said in a statement.

Ratings are constrained by the group's aggressive financial profile, high capital requirements and high exposure to the mature, cyclical and low-margin pallet-management business in the United States, the agency said.

Ratings are supported by IFCO's leading niche market positions, enhanced by the acquisition of Steco and its position as the only recycled-pallet provider in the United States with a nationwide presence, the agency noted.

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