Moody’s cuts Associated Asphalt

Moody's Investors Service said it downgraded the corporate family rating and the probability of default rating of Associated Asphalt Partners, LLC to B3 and B3-PD, respectively, from B2 and B2-PD.

Concurrently, the agency downgraded the company's $350 million senior secured term loan B to Caa1 from B3. Road Holdings III, LLC is a co-borrower of the instrument.

The outlook is stable.

Moody’s said the downgrade reflects Associated Asphalt's vulnerability to competition and new entrants despite its market position and size relative to peers. The company's operating performance has been challenged by higher wholesale pricing and lower retail pricing largely due to increased supply and competition, which led to a marked increase in adjusted debt-to-EBITDA.

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