Fitch Rates Rite Aid's New 8.5% $150MM Convertible Notes 'CCC'.
NEW YORK New York, state, United States
New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of -- Fitch Ratings Fitch Ratings
An international rating agency for financial institutions, insurance companies, and corporate, sovereign, and municipal debt. Fitch Ratings has headquarters in New York and London and is wholly owned by FIMALAC of Paris. has assigned 'CCC/RR6' ratings to Rite Aid Corporation's (Rite Aid, NYSE NYSE
See: New York Stock Exchange : RAD) new 8.5% $150 million senior unsecured convertible notes due 2015. The proceeds of the new offering will be used to redeem its $150 million of its 6.125% senior unsecured notes due 2008 at a price equal to approximately 102% of the principal outstanding amount.
Fitch rates Rite Aid as follows:
--Issuer Default Rating (IDR IDR
In currencies, this is the abbreviation for the Indonesian Rupiah.
The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. ) 'B-';
--$1.75 billion bank credit facility 'BB-/RR1';
--$1.25 billion term loans 'BB-/RR1';
--$1.061 billion 2nd lien senior secured notes 'BB-/RR1';
--$1.851 billion guaranteed senior unsecured notes 'CCC+/RR5';
--$758 million non guaranteed senior unsecured notes 'CCC/RR6'.
The Rating Outlook is Stable.
The ratings consider the risk associated with integrating over 1,800 Brooks and Eckerd stores with Rite Aid's existing store base and improving operations at these stores; the company's high leverage, with total adjusted debt/EBITDAR of 8.1 times (x) for the fiscal year ended March 1, 2008; operating statistics that trail those of competitors; and the intense competition in the drug retailing sector. The ratings also reflect Rite Aid's management's concerted efforts to improve the productivity of its store base, the positive demographics of the drug retailing industry, as well as the benefits from leveraging a larger store base.
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