Moody's lowers Continental

Moody's Investors Service said it has downgraded Continental AG's corporate family rating to Ba3 from Ba2.

The outlook remains negative.

Falk Frey, senior vice president and lead analyst at Moody's for Continental, commented: "Today's rating action reflects primarily its concern that the severe downturn in global automotive markets would result in financial ratios below what Moody's had anticipated for the previous Ba2 rating category."

"The negative outlook reflects in particular Conti's potential challenge to meet its financial covenants included in its syndicated credit facilities as well as the upcoming refinancing risk of €3.5 billion due in August 2010 from the VDO acquisition debt," Frey added.

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