Fitch cuts Polska Grupa to BB(pol)

Fitch Ratings said it downgraded Polska Grupa Farmaceutyczna SA's national long-term rating to BB(pol) from BB+(pol) and removed it from Rating Watch negative.

Its national short-term rating is affirmed at B(pol).

The outlook is stable.

Fitch said the downgrade reflects a weakening of debt protection measures, primarily driven by debt-financed acquisitions in the fourth quarter. The group's lease-adjusted net debt-to-EBITDAR ratio grew to almost 6 times at the end of 2007 from 3.5 times at the end of 2006.

Ratings reflect aggressive financial policy and growth strategy through selected acquisitions, the agency said.

They also consider the company's leading position in the growing Polish pharmaceuticals distribution market, Fitch said.

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