S&P downgrades RadioShack

Standard & Poor's said it lowered the corporate credit rating on RadioShack Corp. to CCC from CCC+, along with the rating on its senior unsecured notes to CCC from CCC+.

The recovery rating of 4 remains unchanged, indicating 30% to 50% expected default recovery.

The outlook is negative.

The downgrade reflects a view that a default could occur within 12 months, absent a major business turnaround or increased liquidity, S&P said.

The company's operating performance has experienced steady deterioration over several quarters and liquidity is weak, said Nalini Saxena, an S&P analyst.

The downgrade also considers the ongoing tightening of vendor terms and outlays required to pursue the product mix shift and store-refresh initiatives designed to kick start a revival of the business, Saxena said.

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