After S&P Move, Ascena Says It Remains in Full Compliance With Obligations

By Josh Beckerman

After S&P Global Ratings said it views two Ascena Retail Group Inc. debt repurchases as "tantamount to default," Ascena said it "remains in full compliance with all of its obligations under its financing agreements and intends to remain so."

Ascena's brands include Ann Taylor, LOFT, Lane Bryant and Justice. When it reported second-quarter results Monday, the company said it repurchased about $80 million of term loan debt for about $49 million during the quarter, and after quarter-end bought about $42 million of debt for about $29 million.

Ascena said Thursday that "bankruptcy is not being considered," and said the debt repurchases are associated with balance sheet optimization efforts.

S&P gave Ascena an SD (selective default) rating, and expects to raise the rating back to CCC in the coming days.

Ascena shares fell 19% during the regular session during a broad selloff, and declined 12% to $1.30 after hours.

Write to Josh Beckerman at josh.beckerman@wsj.com

(END) Dow Jones Newswires

March 12, 2020 19:02 ET (23:02 GMT)

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