S&P says Interpublic unchanged

Standard & Poor's said Interpublic Group of Cos.' ratings are unchanged including its corporate credit at BB+ with a negative outlook on news the company has reached a definitive agreement to sell NFO WorldGroup Inc. for $425 million.

Selling the marketing research unit will provide the company with an important boost to liquidity, as it strives to pay down debt, S&P noted.

Despite the sale proceeds, Interpublic is not expected to materially improve its credit profile in the near term. Lower EBITDA reflects revenue underperformance due, in part, to a sluggish revenue environment, as well as rising severance costs.

Also, likely cash outlays for additional restructuring efforts will further hamper debt reduction.

Positive operating trends and signs of advertising stability must be reestablished before an outlook revision to stable is considered, S&P said.

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