Moody's may cut Reynolds, Graham

Moody's Investors Service said it placed the B2 corporate family and other instrument ratings of Reynolds Group Holdings Ltd. and Graham Packaging Company Inc. under review for possible downgrade. Reynolds' Ba3 senior secured bank credit facilities, Reynolds Group Issuer Inc.'s Ba3 senior secured bonds and Caa1 senior unsecured bonds and Graham Packaging's Caa1 senior subordinated bonds, Caa1 senior unsecured bonds and B1 senior secured bank credit facilities are one review.

The review follows Reynold's announcement that it had signed a definitive merger agreement to acquire Graham for $25.50 a share and the assumption or refinancing of existing debt and the subsequent termination of Graham's previous merger agreement with Silgan Holdings Inc. on June 17, the agency said.

The deal is expected to close in the second half of this year and is subject to customary regulatory approvals and closing conditions, the agency added.

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