Moody's rates Aleris notes B1

Moody's Investors Service said it assigned Ba3 corporate family and probability-of-default ratings to Aleris International, Inc. and a B1 rating (LGD4, 67%) to its proposed $500 million senior notes due 2018.

The outlook is stable.

Proceeds will be used to pay a $300 million dividend to its shareholders and for general corporate purposes.

The Ba3 corporate family rating reflects Aleris's moderate leverage, pro-forma for the notes issue, following its substantial deleveraging upon emerging from bankruptcy, according to the agency.

The rating acknowledges the company's strong market position as a major global supplier of aluminum rolled products, its geographic and end market diversity, and its long-term customer relationships as well as its solid liquidity position, Moody's said.

The corporate family rating also reflects expectation that the recovery in Aleris's key end markets will continue to be uneven and that its exposure to the building and construction industries will remain a weakness in 2011, the agency noted.

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