Moody's rates Aleris loans Ba3

Moody's Investors Service said it confirmed Aleris International, Inc.'s B1 corporate family rating and assigned a Ba3 rating to the company's proposed seven-year senior secured guaranteed term loans totaling $650 million, which Aleris is issuing to partially finance its €691 million acquisition of certain aluminum assets from Corus Group plc and to refinance its existing debt.

The balance of the necessary funding will be provided under a senior unsecured guaranteed bridge loan (unrated) provided by Deutsche Bank and Citigroup. Aleris has begun a tender offer for its 10 3/8% senior secured notes due 2010 and its 9% senior notes due 2014 and is seeking consent to a number of modifications to restrictive covenants, events of default, and in the case of the 10 3/8% senior secured notes, the release of security.

Moody's has confirmed the B2 rating on the 10 3/8% senior secured notes and the B3 rating on the 9% senior unsecured notes. The ratings for the proposed financings assume that the tender offer will be successful, the desired consents obtained and that the acquisition and associated financing transactions will close as contemplated.

The outlook is negative.

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