S&P downgrades Packers

S&P said it lowered all of the ratings on Packers Holdings LLC, including the issuer credit rating, to CCC from CCC+.

The outlook is negative.

S&P noted in a news release that Packers Holdings has faced a rising number of contract cancellations amid the fallout from child labor law violations, which S&P believes will cause performance to decline more than previously anticipated.

“Considering its diminished liquidity position, and the deep discount its obligations are trading at in the secondary markets, we believe Packers faces heightened risk of a distressed debt restructuring or payment default in the next 12 months,” S&P said in the release.

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