Moody's rates Conexant Caa1, floaters B1

Moody's Investors Service said it assigned a B1 rating to the senior secured floating-rate notes and a Caa1 rating to the corporate family of Conexant Systems, Inc.

The ratings reflect both the overall probability of default of the company under Moody's LGD framework using a fundamental approach, to which Moody's assigns a PDR of Caa1 and a loss-given-default of LGD-2 for the senior secured notes.

Moody's said it also assigned a SGL-3 speculative-grade liquidity rating, reflecting adequate liquidity.

The outlook is stable.

The Caa1 corporate family rating reflects Conexant's challenges, given the company's high financial leverage and cost structure, to withstand the dramatic swings inherent in the semiconductor industry, the agency noted.

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