S&P puts TK Aluminum on developing watch

Standard & Poor's said it placed its CCC+ long-term corporate credit rating on TK Aluminum Ltd. on CreditWatch with developing implications, meaning that the rating could be raised, lowered or affirmed.

The CreditWatch placement follows TK's announcement of the sale of its operations in North and South America, China and Poland to Tenedora Nemak SA de CV and a subsequent financial restructuring.

The agency said that while it views favorably TK's intention to use the sale proceeds to repay existing debt, there is uncertainty as to the resulting credit profile, in terms of both business and financial risk.

S&P noted that the rating reflects TK's very aggressive financial profile and the many challenges the company faces in a cyclical, highly competitive industry.

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