Moody's drops Reddy Ice

Moody's Investors Service said it downgraded the corporate family rating and probability of default rating of Reddy Ice Holdings, Inc. to B2 from B1 and assigned an SGL-3 speculative-grade liquidity rating.

Moody's said it concurrently lowered the ratings on the $300 million senior secured credit facility and senior discount notes by one notch.

The outlook is negative.

The downgrade reflects declining profitability, weakening credit metrics and concern that a weak economy and emerging competitive threats from ice vending machines could pressure sales volume, the agency noted.

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