...Negative Outlook: Fitch Ratings affirmed CF Industries Holdings, Inc.'s (CF) ratings on Dec. 19, 2013, and revised the Rating Outlook to Negative from Stable. The Negative Outlook is driven by incremental issuance of $1.5 billion in debt, which brings CF's total debt to $4.6 billion, well above Fitch's previous rating sensitivity of $3.5 billion. The proceeds from the issuance are likely to be used for share repurchases. Pro forma for the debt issuance, total debt to EBITDA at Dec. 31, 2013 increased to 1.6x. MLP Structure: Management continues to study master limited partnerships (MLPs). A change to an MLP structure, which might lead to greater cash distributions, could be credit negative. Advantaged Feedstock: Low-cost natural gas, the feedstock used to manufacture ammonia, has pushed CF's EBITDA margins north of 50%, compared to 32% in 2008. However, nitrogen fertilizer prices have come down from highs reached in 2012, as corn prices have declined below the five-year average. As a result,...
