S&P downgrades Toys "R" Us

S&P said it lowered the ratings on Toys "R" Us Inc., including its corporate credit rating, to D from CCC-.

The agency also said it removed the ratings from CreditWatch with negative implications, where they were placed Sept. 7.

S&P also said it affirmed the CCC- corporate credit rating on Toys R Us Property Co. I LLC and removed it from CreditWatch negative.

The outlook is developing.

S&P also said it affirmed the ratings on Toys R Us Property Co. I's debt and removed the ratings from CreditWatch.

The downgrades reflect the group's filing of bankruptcy, the agency explained.

S&P said it believes operating performance during the holiday season could be choppy as a result of the timing, but the company will eventually reorganize and emerge from bankruptcy.

The company has commitments for a $3.1 billion DIP facility, which will provide liquidity for continuing the buildup of holiday inventory, the agency noted.

The developing outlook reflects the potential for the ratings to be lowered if the company does not meet its financial obligations as the bankruptcy progresses, S&P said.

Any upgrade of the entity would be in conjunction with a reassessment of the entire group, the agency added.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.