S&P drops Maretex to CCC+

Standard & Poor's said it lowered the long-term corporate credit rating on Maretex Ltd., which operates under the OJSC Comtech brand, to CCC+ from B- as well the $150 million credit-linked notes issued by special-purpose vehicle C.R.R. BV to CCC+ from B- with 3 recovery rating.

The downgrade is based on expectation of significant losses in the fourth quarter and deterioration of conditions in the steel distribution industry, according to the agency.

The outlook is negative.

S&P said the downgrade reflects expectation that poor results for 2008, weakening demand for steel in Russia and challenging financial market conditions will make it very difficult for Maretex to successfully address the put option on its $150 million credit-linked notes in June 2009.

This is partly offset by the company's fair market position and improving product mix, the agency said.

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