IQW.PR.C / IQW.PR.D Downgraded by DBRS

DBRS has announced that it:

has today downgraded the long-term debt ratings of Quebecor World Inc. (Quebecor World or the Company) to B (high) from BB, and downgraded the preferred share rating to Pfd-5 (high) from Pfd-4. The trend on all ratings is Negative. Commensurate with the ratings downgrade, the ratings have been removed from Under Review with Negative Implications.

These issues were put on Review-Negative on August 14, 2007. They were downgraded from Pfd-4(high) on August 9, 2006.

It ain’t because of sub-prime, at least not directly:

DBRS had placed the ratings of Quebecor World Under Review with Negative Implications on August 14, 2007, as a result of concerns over the Company’s near-term liquidity, the uncertainty in terms of the outcome of negotiations regarding the Company’s bank agreements and the Company’s strategic review of its European printing operations. (Please see separate DBRS press release dated August 14, 2007.)

The downgrade reflects DBRS’s heightened concern over the Company’s near-term financial health which has been materially impacted by liquidity constraints and increased pressure on existing financial covenants.

Quebecor World’s liquidity continues to be adversely impacted by declining EBITDA and cash flow from operations, and could be further constrained should the Company violate debt covenants which could result in early debt redemption. Additionally, DBRS notes the Company’s near-term liquidity issues could be further impacted by restricted access to financing as a result of current capital market conditions.

S&P downgraded these issues to P-5(Watch Negative) from P-5(high)(Watch Negative) on August 28, 2007.

2 Responses to “IQW.PR.C / IQW.PR.D Downgraded by DBRS”

  1. […] Well, we all know that IQW.PR.C was recently downgraded. But there are still people buying the common, which gives rise to a kind-of interesting arbitrage possibility. […]

  2. […] It was only about five weeks ago that these issues were last downgraded and now DBRS has announced: DBRS has today downgraded the long-term debt of Quebecor World Inc. (Quebecor World or the Company) and its debt-issuing subsidiaries to B from B (high) and the preferred share ratings to Pfd-5 from Pfd-5 (high). The trend on all ratings remains Negative. […]

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