Moody's may cut Del Monte

Moody's Investors Service, Inc. said it has placed the long-term ratings of Del Monte Corp., including its B2 corporate family rating, under review for downgrade following the company's announcement that it has signed a merger agreement with Natural Balance Pet Foods, Inc.

Del Monte's SGL-2 speculative-grade liquidity rating was unchanged.

Moody's said that its review will focus on the company's acquisition strategy and on further details about the proposed merger agreement and the resulting credit implications given the limited cushion in the company's ratings for acquisitions due to high leverage and recently soft operating performance in core segments.

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