S&P: Tiscali on watch

Standard & Poor's said it placed its B+ long-term corporate credit rating on Tiscali SpA on CreditWatch with negative implications.

The CreditWatch listing also applies to S&P's B+ and BB- long-term debt ratings on, respectively, the €50 million senior secured term loan and €50 million senior secured revolving credit facility taken on by financing vehicle Tiscali U.K. Holdings Ltd. and guaranteed by Tiscali SpA, the agency noted.

S&P added that the recovery ratings on these obligations are unchanged, at 3 and 2, respectively.

According to the agency, the CreditWatch placement primarily reflects the significant shortfall in Tiscali's second-quarter 2008 earnings growth and cash flow generation compared with the company's earlier expectations and the likely tightening of covenant headroom during the second half of the year.

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