S&P rates new Photronics convertibles B

Standard & Poor's assigned a B rating to Photronics Inc.'s new convertible subordinated notes. It affirmed the company's existing ratings, including the B on its other convertible subordinated notes, and withdrew its bank loan rating. The outlook is stable.

S&P said the ratings reflect Photronics's "moderate financial profile and strong position in an evolving niche market, offset by the challenges of international growth and the company's ongoing acquisition strategy in a highly competitive marketplace."

The rating agency noted demand in Photronics' business of photomasks is somewhat less volatile than other semiconductor sectors, although growth is constrained by chipmakers' efforts to reduce prototyping activity and maintain fewer backup mask sets. In addition, S&P said, "competitive pressures are substantial, as leading mask suppliers vie to increase their shares of semiconductor makers' mask requirements."

Moody's revises AIMCO outlook from stable to negative

Moody's Investors Service revised its outlook for the ratings of Apartment Investment and Management Co. to negative from stable, reflecting concerns surrounding the REIT's ability to successfully integrate the acquisition of the $1.5 billion Casden Properties portfolio and heightened leverage. In specific, the rating agency noted that AIMCO will initially pay $1.063 billion for the property portfolio by issuing $213 million of common stock and/or common OP Units, priced at $47 per share, paying $166 million in cash and assuming existing mortgage indebtedness of $684 million.

While Moody's views the REIT's issuance of common equity as a plus, this acquisition will remain highly leveraged based upon the assumption of $684 in mortgage debt and the use of its line of credit to fund much of the cash portion of the acquisition. The REIT's appetite for highly-levered acquisitions - as exemplified by this transaction - combined with AIMCO's high secured leverage, are substantial rating concerns. AIMCO expects its leverage profile to improve as proceeds from property sales are used to reduce debt, and as some of its in-the-money convertible preferred stock converts to common stock. Principal amortization of debt should also help to reduce leverage.

Ratings confirmed include AIMCO's preferred stock at Ba3, its senior unsecured debt shelf at (P)Ba1, its subordinated debt shelf at (P)Ba2 and its preferred stock shelf at (P)Ba3.

Fitch cuts NiSource long-term ratings to BBB from BBB+

Fitch downgraded the long-term debt ratings, including the implied senior unsecured debt, of NiSource Inc.to BBB from BBB+, and the trust preferred rating to BBB- from BBB. Concurrently, Fitch cut the long-term debt ratings of its subsidiaries, Northern Indiana Public Service (NIPSCO), Columbia Energy Group, NiSource Capital Markets and NiSource Finance Corp.

The downgrades reflect weak consolidated credit coverage ratios and higher than projected debt levels at NiSource, resulting in a credit profile which is more consistent with the BBB rating category, Fitch said. The commercial paper program at NiSource Finance Corp. has been reaffirmed at F2. The rating outlook for NiSource and its subsidiaries is stable, Fitch said.

S&P downgrades Fleetwood

Standard & Poor's downgraded Fleetwood Enterprises Inc. and removed the ratings from CreditWatch where they were place on March 1, 2001. Ratings affected include the corporate credit rating, lowered to BB- from BB+ and the convertible trust preferred securities, lowered to D from B+. The outlook remains negative.

S&P said the lower corporate credit rating reflects "a materially weakened business position, due to the continued, very competitive industry conditions for both of Fleetwood's major business segments. In addition, Fleetwood's financial profile remains constrained, as reflected by the granting of security to the company's bank lenders and the recent discontinuation and deferral of the company's common and preferred dividends, respectively."

While Fleetwood has taken steps to realign its operations and management, improve its products and shore up its external liquidity position, S&P said current industry conditions and uncertain near-term economic prospects mean it is unlikely debt-protection measures will return to historically strong levels in the near to intermediate term.

S&P rates new Boise Cascade ACES BB+

Standard & Poor's assigned a BB+ rating to Boise Cascade Corp.'s recent offering of 7.5% adjustable conversion rate equity security (ACES).

S&P downgrades Elektrim

Standard & Poor's downgraded Elektrim SA, including cutting the €440 million of 3.75% convertible notes due 2004 issued by Elektrim BV to CCC+ from B. The ratings remain on CreditWatch with negative implications.

S&P rates new UMC convertibles BBB+

Standard & Poor's assigned a BBB+ ratings to United Microelectronics Corp.'s new issue of convertible bonds due 2004.

S&P puts COR, Millennium on positive watch

Standard & Poor's put both COR Therapeutics Inc. and Millennium Pharmaceuticals Inc. on Credit Watch with positive implications.

Ratings affected include COR's $300 million of 5% convertible subordinated notes due 2007 rated CCC and its $250 million of 4.5% convertible senior notes due 2006 rated B-.

Also affected is Millennium Pharmaceuticals $400 million of 5.5% convertible notes due 2007 rated CCC.

S&P puts Tower Automotive on negative watch

Standard & Poor's put Tower Automotive Inc. on CreditWatch with negative implications. Ratings affected include the senior unsecured debt at BB+, the convertible subordinated debt at BB- and the preferred stock and convertible trust preferreds at B+.

S&P said the action reflects "increasing concern that difficult industry fundamentals will prevent the company from achieving the improvement in financial measures factored into existing ratings and that financial flexibility could become more constrained than previously expected."

"Tower is currently experiencing earnings pressures due to the slowdown in the North American original equipment automotive market, increased pricing pressures, and significant launch costs for new vehicle platforms," the rating agency said.

These issues have led to "a significant deterioration" in credit protection measures in the past year, S&P added, noting that the company's existing ratings incorporate an expectation that financial measures would improve next year as a result of restructuring actions during the past year and a slowdown in new launch activity.

"However, given the current industry outlook, the likelihood of a significant improvement has become more uncertain," S&P said.

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