S&P: Rural/Metro view negative

Standard & Poor's said it revised its outlook on Rural/Metro Corp. to negative from stable and affirmed the B corporate credit rating.

The company has a BB- rating for its $20 million senior secured revolving credit facility due 2010 and its $135 million term loan B due 2011.

The outlook revision reflects S&P's increased concern with the company's limited liquidity, according to the agency.

The ratings reflect the company's exposure to government reimbursement rates, thin operating margins, high levels of bad debt and concerns about the sustainability of price increases from its commercial payers, S&P said.

These issues are partly mitigated by the company's diverse and long-standing client list, and its willingness to repay debt, the agency said.

The issuer's total lease-adjusted debt-to-EBITDA ratio is about 5 times.

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