Carter Holt climbs back up rating scale

By PAM GRAHAM

Carter Holt Harvey had its short-term credit rating restored by Standard & Poor's yesterday after complaining about a downgrade announced on September 22.

S&P raised the company's short-term rating back to A-2 from A-3 and put a stable, rather than negative, outlook on the rating.

Carter Holt had mounted a "full court press" assault against the downgrade, chief executive Peter Springford said yesterday.

Carter Holt argued its rating should not mirror that of its 50.5 per cent owner International Paper because the New Zealand company's balance sheet was strengthening and there were no financial guarantees, or covenants, between the two.



The company paid off $600 million of debt last year and earnings before interest tax, depreciation and write-offs covered interest payments by 5.5 times.

The lack of cross guarantees as well as the roles minority shareholders and independent directors had were taken into account.