Fitch gives Rite Aid notes BB-, cuts existing notes

Fitch Ratings said it assigned a BB-/RR1 rating to Rite Aid Corp.'s new secured notes, and downgraded its existing guaranteed unsecured notes to B+/RR2 from BB-/RR1 based on increased quantum of secured debt.

In addition, Fitch affirmed Rite Aid's remaining ratings, including its long-term issuer default rating at B-.

Rite Aid's new $600 million of 7½% secured notes due 2025 will be issued in February in exchange for a like amount of the company's existing 6 1/8% guaranteed unsecured notes due 2023.

The outlook is stable.

“Rite Aid's ratings reflect continued operational challenges, which have heightened questions regarding the company's longer-term market position and the sustainability of its capital structure,” the agency said in a news release.

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