S&P Places Darden (DRI) on CreditWatch 'Developing' Following Plans to Spin Red Lobster Unit

December 19, 2013 11:40 AM EST
Standard & Poor's Ratings Services said it placed its ratings, including the 'BBB-' corporate credit rating, on Orlando, Fla.-based Darden Restaurants Inc. on CreditWatch with developing implications.

"The CreditWatch placements follow Darden's announcement that it plans to separate Red Lobster from the remaining group," said credit analyst Helena Song. "The proposed separation is subject to approval by Darden's shareholders and regulators. The company expects that the transaction, if approved, could be completed in early fiscal 2015 (beginning May 26, 2014)."

We expect to resolve the CreditWatch placements after evaluating the business and financial impact of the transaction, the financing details, and management's financial policies and capital structure.

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