S&P confirms Advance Agro notes

Standard & Poor's confirmed Advance Agro Public Co. Ltd.'s $48.7 million 13% notes due 2007 issued by Advance Agro Capital BV at CC and removed them from CreditWatch negative where it was placed in February 1999. The issuer rating on Advance Agro remains at SD because the company has not made timely payments on its bank debt since the beginning of 2002.

S&P added that the rating on the notes indicates that they remain highly vulnerable to nonpayment, although the company continues to make timely interest payment.

Advance Agro's ability to service its debt in a timely manner is severely constrained by a large amount of potential debt repayments, strained financial position of other companies in the group, unavailability of any cushion on liquidity facilities and high dependence on local banks for meeting the foreign currency debt obligations, S&P said.

S&P added that it considers Advance Agro's debt level, which has been more than 75% of capital since 1999, as very aggressive for a company engaged in a cyclical business. The unsustainability of its high debt is reflected in the very weak fund from operations to debt ratio of 9% for the past five years.

S&P cuts DVI

Standard & Poor's downgraded DVI Inc. including cutting its $100 million 9.875% senior notes due 2004 and $55 million 9.875% senior notes due 2004 to D from CCC-.

S&P said the action follows DVI's announcement stating that the company will not make the Aug. 1 interest payment on its 9 7/8% senior notes due 2004.

Fitch cuts DVI, still on watch

Fitch Ratings downgraded DVI, Inc.'s senior unsecured debt to C from CCC and kept it on Rating Watch Negative.

Fitch said the action follows DVI's announcement of its failure to make an interest payment due Aug. 1. The company has a cure period of 30 days to make the payment.

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