S&P Global Ratings has lowered the issuer credit ratingson Och-Ziff Capital ManagementGroup LLC and its operating group to BBB from BBB+.
The affected operating group entities are OZ Management LP, OZ Advisors LP, and OZ Advisors II LP.
The outlook is negative. In May, S&P the company's outlook tonegative from stable.
S&P also lowered the senior unsecured debt ratings toBBB from BBB+.
In addition, S&P assigned an issuer credit rating of BBBon Och-Ziff Finance Co. LLC with a negative outlook, as the company is a coresubsidiary of Och-Ziff Capital Management Group.
S&P credit analyst Sebnem Caglayan said in a newsrelease that the downgrade reflects the rating agency's view that the continued asset outflows andchallenged investment performance, combined with existing legal risks, haveweakened the company's business risk profile.
The outlook recognizes S&P's expectation that it coulddowngrade the company in the next 18 months to 24 months if any potentialsettlement related to the Foreign Corrupt Practices Act or further reduction inAUM and adjusted EBITDA results in higher leverage, such that debt-to-adjustedEBITDA exceeds 1.5x on a sustained basis, or weaker liquidity for the company,the rating agency said.
S&P Global Ratingsand S&P Global Market Intelligence are owned by S&P Global Inc.