Moody's may cut Posco

Moody's Investors Service said it placed Posco's A2 foreign-currency bond rating on review for possible downgrade.

The review was prompted by the company's higher-than-expected financial leverage in 2010 and the increasing likelihood that its financial profile will remain inconsistent with the A2 rating over an extended period because of its sizeable investment plans and appetite for acquisitions, said Chris Park, a Moody's analyst.

Posco's key financial metrics deteriorated materially in 2010, primarily because a rise in consolidated debt, the agency said.

The review also takes into consideration management's aggressive appetite for mergers and acquisitions in non-steel businesses, Moody's added.

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