S&P: Pacific Lumber off watch

Standard & Poor's said it affirmed its CCC- corporate credit rating on Pacific Lumber Co. and removed the rating from CreditWatch negative. The outlook is developing

This action follows the company's announcement that it has secured new financing, alleviating S&P's short-term liquidity concerns and retired its $35 million borrowing-based revolving credit facility, ending its default under the credit agreement.

S&P said the rating on Pacific Lumber reflects very weak financial performance during the past few years, the public's environmental sensitivity regarding harvesting trees in California, onerous environmental regulations with multiple governmental agencies involved in the harvest permitting process and narrow product focus with little operating diversity in the highly cyclical lumber market.

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