Fitch Affirms Spectrum's 'CCC' IDR; Outlook Negative

Business Wire, April 1, 2008

NEW YORK -- Fitch Ratings has affirmed Spectrum Brands, Inc.'s (SPC) ratings as follows:

--Issuer default rating (IDR) 'CCC';

--$1 billion term loan B maturing March 30, 2013 'B/RR1';

--$225 million ABL maturing Sept. 28, 2011 'B/RR1';

--Eur262 million term loan maturing March 30, 2013 'B/RR1';

--$700 million 7.375% senior sub note maturing Feb. 1, 2015 'CCC-/RR5';

--$2.9 million 8.5% senior sub note, maturing Oct. 1, 2013 'CCC-/RR5';

--$347 million 11.25% variable-rate toggle senior sub note, maturing Oct. 2, 2013 'CCC-/RR5'.

The Rating Outlook remains Negative.

The ratings reflect SPC's high leverage and relatively low liquidity. On a pro-forma basis for the last 12 months ended Dec. 30, 2007, total debt/EBITDA was 9 times (x) and EBITDA/Cash Interest 1.3x. The metrics are on a pro-forma basis to include the EBITDA and interest allocation of the Lawn & Garden operation which is accounted for as a discontinued operation. The rating also reflects stability and some improvement in operations as exemplified by three straight quarters of EBITDA improvement. At Dec. 30, 2007 SPC had $166.4 million in cash and availability under the ABL. With this level of liquidity, Fitch expects that the company should be able to finance peak working capital requirements during its second quarter.

The Negative Outlook encompasses the deterioration in financial and credit protection measures since 2005 as well an uncertain business profile given that parts of the company are up for sale. However, if SPC can continue to demonstrate continued improvement in its operations over the next two to three quarters, the Outlook may be reviewed with a view toward stabilization. Any change in the company due to a material sale of a business segment will prompt a review of the Outlook and rating at that time.

Spectrum is a global branded consumer products company with operations in seven product categories: consumer batteries; lawn and garden; pet supplies; electric shaving and grooming; household insect control; electric personal care products; and portable lighting.

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.