SMU Problems Mean Downgrade

SMU Problems Mean Downgrade

Corporate & Sovereign Strategy

Moody’s has lowered SMU’s credit rating to B3 from B2 and placed the Chilean retailer on review for further downgrade, it says. The move follows the revelation this month of reporting errors that put it in violation of debt covenants, and a plan to fix the situation by raising $500m in equity. Moody’s flags “weaker than expected operating results since September 2012 that led to higher than expected leverage and weaker overall credit metrics that are no longer commensurate with the B2 rating cat

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