Moody's lifts ACIH to SGL-3

Moody's Investors Service said it upgraded ACIH, Inc.'s speculative grade liquidity rating to SGL-3 from SGL-4 and confirmed the company's corporate family and probability-of-default ratings at B2 and $174 million senior discount notes due 2012 at Caa1 (LGD6, 90%).

The agency also confirmed Atrium Cos., Inc.'s $378.5 million senior secured term loan B due 2012 and $50 million senior secured revolving credit facility due 2011 at B1 (LGD3), but changed the loss-given-default rate on the loans to 35% from 37%.

This concludes the review for possible downgrade begun on Oct. 30, and the outlook is negative.

The agency said the SGL-3 speculative grade liquidity rating reflects improved headroom under the company's covenants governing the senior secured credit facilities due to recent amendments and Moody's expectation that the company's free cash flow generation will likely be slightly positive, although weak, over the next four quarters.

The negative outlook reflects the current and anticipated impact of the homebuilding and remodeling market slowdown on Atrium's sales and cash flow generation, Moody's said.

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