S&P drops Takefuji

Standard & Poor's said it lowered its long-term counterparty credit rating on Takefuji Corp. by four notches to CC from B-.

The rating remains on Creditwatch with negative implications.

S&P said that this rating action reflects the high likelihood that a debt exchange that Takefuji offered on Nov. 16 will be recognized as a default under S&P's criteria, if it goes ahead.

At the same time, the agency said it lowered its rating on the outstanding senior unsecured bonds issued by Takefuji by two notches to CCC, given slower progress in Takefuji's fund-raising than it expected, and removed the rating from Creditwatch with negative implications.

The rated long-term senior unsecured bonds are all straight bonds, and are not subject to the debt exchange, the agency noted.

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