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Ivex Packaging Rtgs Placed on CreditWatch Pos by S&P.

NEW YORK--(BUSINESS WIRE)--S&P CreditWire 8/4/97--Standard & Standard & Poor's today has placed its ratings on Ivex Packaging Corp. and its unit, IPC (1) (InterProcess Communication) The exchange of data between one program and another either within the same computer or over a network. It implies a protocol that guarantees a response to a request.  Corp., on CreditWatch with positive implications (see list below).

The listing follows the announcement of an initial public offering (IPO (Initial Public Offering) The first time a company offers shares of stock to the public. While not a computer term per se, many founders, employees and insiders of computer companies have found this acronym more exciting than any tech term they ever heard. ) of common stock, estimated in the range of $125 million-$144 million, to be issued and sold by the company, as well as by Acadia Partners L.P. and certain related investors. Management has indicated that it intends to use its share of the proceeds, together with borrowings under a new $475 million credit facility, to retire or refinance all or a portion of its high-cost debt.

The proposed recapitalization Recapitalization

Restructuring a company's debt and equity mixture often with the aim of making a company's capital structure more stable.

Companies often want to diversify their debt-to-equity ratio to improve liquidity.
 could result in a meaningful improvement in cash flow coverage measures and financial flexibility, even though the firm's capital structure will remain strained. Lower interest costs and decreased debt levels could result in funds from operations Funds From Operations (FFO)

Used by real estate and other investment trusts to define the cash flow from trust operations; earnings with depreciation and amortization added back.
 to total debt in the mid-teens percentage area from around 12%, and earnings before interest, taxes, depreciation, and amortization Earnings before interest, taxes, depreciation, and amortization (EBITDA)

A financial measure defined as revenues less cost of goods sold and selling, general, and administrative expenses.
 (EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become ) could cover interest expense by over 2.5 times (x), compared to about 1.7x now. Moreover, financial flexibility could benefit from an extended maturity schedule, an increase in credit facility availability, and access to equity markets. Thus, this leading manufacturer of oriented polystyrene sheet and film and thermoformed polystyrene packaging products would have additional liquidity to continue to pursue investment opportunities and strengthen its somewhat below average business position.

Successful completion of the IPO could result in a modest upgrade of the corporate credit and long-term ratings. However, ratings on the public issues would be withdrawn if they are redeemed. Standard & Poor's plans to meet with management to review its business and financial strategies.


Corp credit rtg B+

Sr unsecd debt B- IPC Corp.

Corp credit rtg B+

Sub debt B- ---CreditWire

CONTACT: Paul Vastola, 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
 (1) 212-208-1674

Thomas R Kelly, New York (1) 212-208-1944
COPYRIGHT 1997 Business Wire
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1997, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Publication:Business Wire
Date:Aug 4, 1997
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