Debt-rating company Fitch has assigned international paper and packaging group Smurfit Kappa’s prospective secured notes an expected rating of BB+, which is one step below investment grade.

Fitch Ratings also affirmed Smurfit Kappa’s long-term foreign currency issuer default rating at BB. The agency said the continuation of the current path in debt-reduction by Smurfit Kappa and the improvement in credit metrics could lead to an upgrade.

The Smurfit Kappa group is refinancing its 7.75 per cent senior subordinated notes due in 2015 with a new €400 million equivalent dual-tranche senior secured notes offering.

Moody’s assigned a Ba2 rating to new debt, a move that will lower the rating of the group’s existing senior secured notes to Ba2 from Ba1. – (Reuters)