Casino Guichard-Perrachon shares and bonds slumped after Standard & Poor’s said it’s considering cutting the French grocer’s debt rating to junk, citing concerns about leverage and a poor environment in Brazil and Asia.

S&P said Saturday Casino’s BBB- long-term rating is on negative watch as its profitability will continue to be fairly weak for an extended period of time and its debt levels, primarily located at the French operations, are too high. The rating may be cut as much as two levels. S&P had confirmed Casino’s rating in December, a view which changed after the grocer on Thursday lowered its 2015 earnings expectations.

Coupons on about 8 billion euros of Casino bonds would increase by 125 basis points if the company were cut to junk, Exane BNP Paribas wrote in a note Monday. That would amount to about 90 million euros of extra interest costs per year, according to the firm.

The retailer is under attack by short-seller Carson Block’s Muddy Waters LLC, which contends that Casino is using financial engineering to mask a sharply deteriorating core business. It also said S&P has understated the retailer’s “dangerously” high debt burden. Casino has rejected the claims, saying it has a solid financial structure and that it may take legal action. 

“This 180-degree reversal only one month after affirming Casino’s credit rating strongly supports our thesis, and is extraordinary given that S&P is warning about a two notch downgrade,” Block said by e-mail.

Casino shares fell as much as 9.7 percent and were down 8.4 percent at 36.66 euros as of 5:04 p.m. in Paris. The retailer’s 900 million euros ($980 million) of bonds maturing in August 2026 slumped 11 cents on the euro to a record-low of 76 cents, according to Bloomberg data.

Casino also said it plans to raise 4 billion euros by selling assets this year, including its Big C subsidiary in Thailand and a business in Vietnam.

Credit-default swaps insuring Casino’s bonds against losses jumped to the highest on record at 536 basis points from 430 basis points on Friday, Bloomberg data show. The contracts are the worst-performing in the Markit iTraxx Europe Index linked to 125 companies with investment-grade ratings.

Casino said the expected improvement in its operating performance in France in 2016 and the asset sales will strengthen its financial structure.

“In the current macro-economic environment, we’re working very actively to our deleveraging," Casino Chief Financial Officer Antoine Giscard d’Estaing said in a phone interview. “We have no liquidity issue.”

The group has unused credit lines of more than 3.5 billion euros that it doesn’t need to use, he said.

Casino’s 650 million euros of notes due in February 2025 dropped eight cents to 78 cents, according to data compiled by Bloomberg.