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S&P lowers Xerium
Standard & Poor's said it lowered its ratings on Xerium Technologies Inc., including the long-term corporate credit rating, to CC from CCC+.
The outlook is negative.
"The rating action reflects the increased likelihood of an exchange of debt for equity, which we would view as distressed and tantamount to default," said S&P credit analyst Sarah Wyeth.
The company announced that it may be in violation of financial covenants in the third quarter, the agency noted. In addition to seeking an amendment to its credit facility, Xerium is exploring strategic alternatives which could include an exchange of debt for equity.
"We could lower the ratings to SD if the company completes an exchange offer," she continued.
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