S&P rates Wild Oats convertible CCC+

Standard & Poor's said it assigned a CCC+ corporate credit rating to Wild Oats Markets Inc. and a CCC+ rating to the company's $115 million 3.25% convertible bonds due 2034.

The outlook is negative.

Proceeds from the note issuance were used to repurchase shares, to pay down debt and for other corporate expenses.

S&P said the ratings reflect the company's thin cash flow protection, high debt leverage, participation in a highly competitive industry, inconsistent comparable sales track record, recent margin deterioration, inherent risks associated with the company's geographic expansion plans and relatively small store base.

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