New York City, Standard & Poor's Ratings Services said today that it lowered its ratings on Petco Animal Supplies Inc., including lowering the corporate credit rating to 'B' from 'BB'. All ratings are removed from CreditWatch, where they were placed with negative implications on July 14, 2006.
On July 14, 2006, Petco accounted that it had entered into a merger agreement with affiliates of Leonard Green and TPG in a transaction valued at approximately $1.9 million. The company has $200 million of rated debt.
“The downgrade reflects a significant increase in financial risk following the LBO of the company,” said Standard & Poor’s credit analyst Robert Lichtenstein.