On Feb. 16, 2005, Standard&Poor's Ratings Services placed its ratings, including its 'B+' long-term corporate credit ratings, on recreational-products manufacturer Bombardier Recreational Products (BRP) on CreditWatch with positive implications, as a result of recent debt reduction. The CreditWatch placement reflects significant deleveraging that results from BRP's replacement of its US$280 million term loan facility with a much smaller US$50 million term loan facility. The debt repayment was financed by BRP's large cash balances, which had not formerly been netted out of Standard&Poor's calculations of leverage. Consequently, the company's debt-to-capital ratio is expected to drop to about 45% from former levels of 63%. Interest and cash flow coverage measures are also expected to demonstrate material improvement. BRP
