S&P downgrades PBG

Standard & Poor's said it lowered the long-term corporate credit rating on PBG SA to B+ from BB-.

The rating also was placed on CreditWatch with negative implications.

The downgrade and CreditWatch placement reflect a view of heightened refinancing risk for PBG, which depends heavily on short-term bilateral bank lines and faces the maturity of a PLN 375 million bond in September 2012, S&P said.

In addition, PBG continues to generate negative free operating cash flow. This is mainly due to road construction projects that consume a lot of PBG's working capital and represent a significant drain on the group's cash flows, the agency said.

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