Moody's Eyes Downgrade of Smart & Final

NEW YORK — Moody's investors Service here said Friday it has placed debt ratings for Smart & Final Holdings Corp. on review for a possible downgrade.

NEW YORK — Moody's investors Service here said Friday it has placed debt ratings for Smart & Final [2] Holdings Corp. on review for a possible downgrade.

Moody's said the ability of the company to resolve its $212 million commercial mortgage-backed securities credit facility on reasonable economic terms by the June 30 maturity date continues to weigh heavily on the ratings, "and as the maturity date gets closer without a resolution, Smart & Final's probability of default will get higher."

According to Moody's, Smart & Final's B3 corporate family rating continues to reflect its weak liquidity, high leverage, geographic concentration and challenging geographic and demographic markets while also recognizing the potential benefits of the company's diversification efforts and new management initiatives.

Besides the corporate family rating, the holding company's other ratings put on review for possible downgrade encompasses its probability of default rating of B3.

Also affected are debt ratings for Smart & Final Stores LLC, including its $47.2 million first lien term loan maturing in May 2014 at B3; its $119.2 million first lien term loan maturing in May 2016 at B3; its $125 million asset-based revolving credit facility maturing in 2016 at Ba2; its $138 million second lien term loan maturing in November 2016 at Caa1; and its $2.4 million second lien term loan maturing in November 2014 at Caa1.