Columbia Energy Changed To RatingAlert-Neg By Fitch IBCA.NEW YORK--(BUSINESS WIRE)--July 15, 1999-- Columbia Energy Group's (Columbia) $2 billion outstanding `A' rated debentures and $850 million `F1' rated 4(2) commercial paper program have been changed to Fitch IBCA's RatingAlert negative from RatingAlert evolving following today's announcement by the company to materially expand its open market common share repurchase plan share repurchase plan A corporation's plan for buying back a predetermined number of its own shares in the open market. Institution of a share repurchase plan derives from management's view that the company has limited outside investment opportunities and . The dollar value of shares eligible to be purchased under the plan has increased from $20 million to $420 million. Columbia was placed on RatingAlert evolving on June 8, 1999 due to the uncertainty resulting from NiSource Inc.'s unsolicited un·so·lic·it·ed adj. Not looked for or requested; unsought: an unsolicited manuscript; unsolicited opinions. unsolicited Adjective offer to purchase Columbia. Columbia's current credit measures and positive operating profile is consistent with its `A' rating. Total debt to total capitalization Total capitalization The total long-term debt and all types of equity of a company that constitutes its capital structure. total capitalization See capitalization. is below 50% and pretax pre·tax adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern interest coverage and cash interest coverage were 3.7 times (x) and 4.4x, respectively for the 12 months ended March 31, 1999. In addition, the company's five-year capital spending capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. plan is expected to cause minimum financial stress. However, the execution of a common share repurchase plan utilizing borrowed funds to finance the purchases would result in increased debt leverage and weakened coverage ratios. As a result, Fitch IBCA's upcoming review of the company's business strategies and overall credit profile could result in a downgrade Downgrade A negative change in the rating of a security. Notes: For example, an analyst may downgrade a stock from strong buy to buy, or a bond rating agency may downgrade a bond from AAA to AA. in its credit ratings. For a copy of Fitch IBCA's latest research report on Columbia dated July 8, 1999, visit the agency's web site at `www.fitchibca.com'. |
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