MUMBAI (Thomson Financial) - Moody's Investors Service said it raised
GameStop Corp.'s corporate family and probability of default ratings to 'Ba1'
from 'Ba2', reflecting the company's strong operating performance combined with
a continuous reduction in its funded debt level.
Moody's also affirmed the company's 'SGL-1' speculative grade liquidity
rating. The rating outlook is stable.
GameStop's Ba1 CFR is supported by the company's strong credit metrics and
its market position as the leading specialty retailer of electronic games with a
particular strength in the used game business, Moody's said.
The rating is primarily constrained by the long-term risk that electronic
gaming content will be made available to download off the internet, potentially
placing GameStop in a challenging competitive position given its sizable store
base.
The rating also reflects the risk of the company over expanding its store
base given its very aggressive store expansion plans.
The stable rating outlook reflects Moody's expectation that the company will
maintain its current level of strong credit metrics along with moderate
financial policies, which include very good liquidity and a very modest level of
fold in acquisitions.
TFN.newsdesk@thomsonreuters.com
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