Moody's rates Agricore SGL-2, loans Ba2, Ba3

Moody's Investors Service said it assigned a Ba3 corporate family rating and SGL-2 speculative grade liquidity rating to Agricore United, a Ba2 rating to its C$525 million three-year senior secured revolving credit facility, a Ba3 to its C$100 million senior secured seven-year term loan and a Ba3 rating to AU Holdings, Inc.'s C$50 million senior secured seven-year term loan, based on the full unconditional guarantee of Agricore United.

The outlook on all ratings is stable.

Moody's said the key factors driving Agricore's rating include the company's strong presence in its core Canadian market, its important role in grain exports for Western Canada and its important role in the production, sale and distribution of crop production products and services for farmers in the region.

Strengths are tempered by its exposure to volatile commodity agricultural markets, the high degree of geographic concentration of raw material supply and product and service sales, its complex business and capital structure and its relatively high leverage and weak debt protection measures for its rating.

The stable outlook reflects Moody's expectation that the company will continue to work to strengthen its operating performance and debt-protection measures and improve its overall return on invested assets.

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