Fitch Downgrades $18B in Tobacco Settlement Debt

Finestone, Deborah
April 2003
Bond Buyer;4/4/2003, Vol. 344 Issue 31608, p1
Trade Publication
Fitch Ratings Inc. downgraded all tobacco settlement securitizations, along with the corporate debt of Altria Group Inc., the parent company of Philip Morris USA Inc. It also placed on Ratings Watch negative the corporate debt of R.J. Reynolds Tobacco Holdings Inc. Fitch downgraded the rating on the tobacco industry, the basis for the bond ratings, to BBB-plus from A. Any further rating action on Altria is likely to result in a similar action on the tobacco securitizations, analysts said in a report. The downgrade is due to litigation against Altria's Phillip Morris USA and the $12 billion bond the company needs to post to appeal a $10 billion judgment that was made by an Illinois judge on a suit alleging the company defrauded smokers of light cigarettes.


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