Moody's gives VeraSun notes B3

Moody's Investors Service said it assigned B3 ratings to VeraSun Energy Corp.'s new notes and affirmed its corporate family rating.

The company is issuing $450 million of notes in two tranches, seven and 10 years, to fund the construction of a new ethanol plant, corn oil equipment for its three operating ethanol plants, investments in terminal infrastructure and early-stage cellulosic ethanol projects and for general corporate purposes, the agency said.

The rating on the company's existing notes due 2012 was upgraded to Ba2, in accordance with Moody's loss given default methodology.

A speculative-grade liquidity rating of SGL-1 was affirmed for the firm, Moody's said, noting that the outlook was moved to stable from positive.

The ratings are supported by the firm's significant cash balances, pre-funded status of capital expenditures for VeraSun's next three ethanol plants as well as other projects listed above, success in starting its third ethanol plant in April 2007 and changes the company has made in bringing in-house the marketing of ethanol and addressing its logistics needs, the agency added.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.