Fitch Ratings comments today that Scottish Re Group Ltd.'s (NYSE:SCT) ratings remain on Rating Watch Negative following today's announcement that SCT has entered into an agreement which will result in a new equity investment into the company of $600 million.
SCT's ratings were placed on Rating Watch Negative on July 31, 2006 due to concerns regarding the company's ability to repay $115 million of senior convertible notes that are expected to be put to the company on Dec. 6, 2006. Fitch believes that SCT has made good progress in resolving the key liquidity and collateral issues, and expects that remaining issues will be resolved over the next several days that will allow affiliate Scottish Annuity & Life Insurance (Cayman) Ltd. (SALIC) to dividend funds to SCT to fund the expected put. Once these remaining issues are resolved, Fitch expects to change the direction of the Rating Watch to Evolving to reflect the pending agreement with MassMutual Capital Partners LLC and Cerberus Capital Management, L.P. announced today.
The following ratings remain on Rating Watch Negative:
Scottish Annuity & Life Insurance Company (Cayman) Limited
--IFS at 'BBB'.
Scottish Re (U.S.) Inc.
--IFS at 'BBB'.
Scottish Re Limited
--IFS at 'BBB'.
Scottish Re Group Limited
--IDR at 'BB';
--4.5% US$115 million senior convertible notes at 'BB-';
--5.875% US$142 million hybrid capital units at 'B+';
--7.25% US$125 million non-cumulative perpetual preferred stock at 'B+'.
Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.
