Valassis holders may convert notes due 2033 after ratings downgrades

By Jennifer Chiou

New York, Feb. 14 - Valassis Communications Inc. announced that holders of its senior convertible notes due 2033 may convert their securities as a result of Standard & Poor's lowering its ratings on the issue to BB- with negative implications.

The notes are convertible at about $44.00 per share.

The Livonia, Mich., marketing services company added that Moody's Investors Service has also downgraded the rating on the convertibles to Ba2 with a stable outlook to reflect Valassis' anticipated financing of the ADVO acquisition.

Valassis added that both agencies rated the notes slightly higher than the company's general rating to reflect the anticipated security interest that the noteholders will receive upon the closing of the ADVO transaction.

The company's shares closed down 3 cents at $17.16 per share on Wednesday.

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