S&P puts Domtar on watch

S&P said it placed Domtar Corp.’s BBB- ratings on CreditWatch with negative implications.

The placement follows the announcement by Paper Excellence that it inked a deal to buy Domtar for an enterprise value of about $3 billion (enterprise value), the agency said.

Paper Excellence is privately held, with pulp and paper assets located in Canada. Domtar is expected to continue to operate as a stand-alone entity, led by its current management team.

“We aim to resolve the CreditWatch placement upon the resolution of the proposed transaction, once we have clarity about the status of Domtar's debt and the group's future financial policies. Given Paper Excellence is a private company and not rated, it is difficult to assess the potential downside to our rating on Domtar, if maintained, but it could be multiple notches,” S&P said in a press release.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.