S&P may cut ResCare

Standard & Poor's said it placed the BB- corporate credit rating and all issue ratings of ResCare, Inc. on CreditWatch with negative implications.

The watch placement reflects a weaker financial risk profile that will most likely occur if private-equity firm Onex Corp. acquires ResCare, S&P said.

The ratings reflect the company's susceptibility to state budget cuts, the fact that it operates in a highly fragmented market and its already-slim profit margins, S&P said.

These are predominating risk factors despite the company's successful track record of acquisitive growth, which has allowed it to expand and diversify its core operations, the agency said.

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