Moody's rates Axia loans B2

Moody's Investors Service said it assigned a B2 corporate family rating to Axia Inc. and a B2 rating to its $175 million senior secured credit facilities, which include a $25 million revolving credit facility due 2010 and a $150 million term loan due 2012.

The outlook is stable.

Moody's said the ratings reflect Axia's high leverage, weak free cash flow generation relative to debt levels, low tangible asset levels and exposure to the cyclical new residential and commercial construction markets, which represent 60% and 40% of sales, respectively.

At the same time, the company's ratings reflect Axia's low customer concentration, market dominance and exceptionally high margins in the automatic taping and finishing tools market, the agency said.

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