On Oct. 4, 2007, Standard&Poor's Ratings Services lowered its long- and short-term corporate credit ratings on Norway-based fertilizer company Yara International ASA to 'BBB' and 'A-3', respectively, from 'BBB+' and 'A-2'. The ratings were removed from CreditWatch with negative implications, where they were placed on May 25, 2007. The outlook is negative. The downgrade follows the close of the acquisition of Kemira GrowHow Oyj (KGH), a Finland-based fertilizer company, and reflects the deterioration in Yara's credit metrics as a result of increased leverage of about $1 billion to finance the transaction. Funds from operations (FFO) to debt is expected to initially deteriorate to the high end of the 20%-30% range and debt to EBITDA to about 2.5x. The
