Moody's downgrades Exide

Moody's Investors Service downgraded Exide Technologies, Inc., affecting $1.7 billion of debt and bank facilities. Included on the reductions were the company's $900 million senior secured bank facility, cut to B3 from Ba3; its $300 million of 10% senior unsecured notes due 2005 and Exide Holding Europe, SA's DM 175 million senior unsecured global notes due 2004, both cut to Caa2 from B1; its $398 million 2.9% convertible senior subordinated notes due 2005, cut to Ca from B3. The outlook is negative.

Moody's said it took the actions after "a series of unexpected negative developments at Exide, together with the company's inability to realize improvement of its key credit protection measures following last year's acquisition of GNB Technologies despite implementation of aggressive cost cutting and capacity rationalization programs."

The rating agency said announcements over the past month have been "most alarming" and indicate Exide's near-term business prospects have "become debilitated by a combination of critical concerns about liquidity; the declining economy and its unforeseen impact on Exide's industrial business; and management upheaval."

Moody's noted the company now has an equity market capitalization of $33 million against $1.4 billion of debt.

Moody's rates Pennzoil $250 mln seniors Ba3

Moody's Investors Service confimed the existing ratings of Pennzoil-Quaker State and assigned a Ba3 rating to the company's new $250 million senior unsecured notes. The action affects $1.2 billion of debt including the company's 8.65% notes due 2002 (Ba2), 6 5/8% notes due 2005 (Ba2), 6¾% notes due 2009 (Ba2), and 7 3/8% notes due 2029 (Ba2).

"The confirmation reflects the poor growth prospects for the motor oil category and its limited free cash flow relative to its indebtedness, as well as the market strengths of the company and the structural subordination of the new bonds," Moody's said, adding that the outlook remains negative.

"The company's free cash flow - in spite of the board's decision to cut common stock dividend to $8 million - should remain limited relative to Pennzoil-Quaker State's debt," Moody's said, adding that the company's current debt load is mostly the result of the merger between Quaker State and the motor oil and refining activities of Pennzoil.

"At $1.2 billion, it has increased from its $1.1 billion level at the time of the Dec. 30, 1998 merger. At the end of June 2001, the ratio of debt to last-twelve-month EBITDA stood at 4.25 (excluding restructuring and other charges)," Moody's stated.

Moody's downgrades International Wire sr sub notes to Caa1

Moody's Investors Service downgraded most of International Wire Group, Inc.'s ratings, including cutting its two series of $150 million of 11¾% senior subordinated notes due 2005 to Caa1 from B3. The B1 rating on its $77 million senior secured credit facility due 2002 was confirmed. The outlook on all ratings is negative.

Moody's said the reduction reflects its "expectation of further deterioration in International Wire's operating performance as a result of the slowing economic activities and declining customer demand, particularly from the automotive, electronics and data communications industries."

Also influencing the rating agency is the company's high financial leverage and weak balance sheet although Moody's added the company has a "significant presence" in the copper wire business and established customer relationship and is implementing substantial cost-cutting measures.

Moody's noted the automotive industry accounts for 40% of International Wire's sales and weakness in this industry is likely to cause further deterioration in the company's performance..

Moody's changes Head Holding outlook to stable from positive

Moody's Investors Service affirmed the ratings of Head Holding GmbH but cut the rating outlook to stable from positive after the company announced it will not meet its operating income target for the year.

The release stated that the change affects $64 million of the company's debt, and added that the Head Holding's Ba2 senior implied rating, its B1 senior unsecured issuer rating, and its B1 senior unsecured debt rating of the senior notes are affirmed.

Head Holding GmbH manufactures sporting goods, and is based in Austria.

S&P cuts CKE Restaurants outlook to developing from negative

Standard & Poor's revised its outlook on CKE Restaurants Inc. to developing from negative and affirmed the company's ratings. Included are CKE's B- corporate credit and senior secured bank loan ratings and its CCC subordinated debt ratings.

S&P said it revised the outlook because CKE has made "significant progress" reducing the balances on its credit facility.

During the second quarter of 2001, the sale of additional Carl's Jr. stores and cash flow from operations enabled the company to reduce debt under its credit facility to $19.5 million at the end of the quarter, S&P said.

The rating agency said it believes the repayment improves CKE's ability to obtain a new bank line before the existing $135 million facility matures on Feb. 1, 2002.

S&P downgrades Stillwater Mining

Standard & Poor's downgraded Stillwater Mining Co. and put it on CreditWatch with negative implications. Ratings affected include Stillwater's senior secured bank loan, cut to BB from BB+, and senior unsecured debt, cut to B from B+.

S&P said its action reflects "the rapid and severe decline in platinum group metals prices" and its impact on Stillwater's finances. The rating agency also said it is concerned about potential covenant violations, higher than expected costs and its third quarter earnings announcement, which said Stillwater is seeking alternative financing to complete the development of its East Boulder mine project, as it may not have sufficient funding in light of weaker platinum group metals prices.

From a record high in January of $1,094 per ounce for palladium and a 13-year high of $645 per ounce for platinum, prices have now fallen to $343 and $423 respectively, S&P said.

S&P said it does not expect "a meaningful improvement" in near-term platinum group prices in light of the Sept. 11 terrorist attacks.

Supply contracts with General Motors Corp., Ford Motor Co., and Mitsubishi Corp. for automobile catalytic converters act as a hedge for Stillwater, S&P said. "Nevertheless, after adjusting the company's third quarter results to reflect current spot market prices and factoring minimum price floors for these contracts, the EBITDA to capitalized interest ratio would be a very weak 1.4x."

S&P downgrades ASAT

Standard & Poor's downgraded ASAT Finance LLC's $155 million 12½% senior notes due 2006 to B+ from BB-.

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