Moody's may downgrade Riddell Bell

Moody's Investors Service said it placed Riddell Bell Holdings Inc.'s B1 corporate family rating, B1 $50 million guaranteed senior secured revolving credit facility due 2010, B1 $109 million guaranteed senior secured term loan due 2011 and B3 $140 million 8 3/8% guaranteed senior subordinated notes due 2012 under review for possible downgrade and affirmed the company's SGL-2 speculative grade liquidity rating.

The rating actions following the announcement that Riddell Bell has reached an agreement to acquire 100% of the outstanding capital stock of Easton Sports Inc. for $400 million.

Moody's said the review for downgrade reflects the potential for a material increase in debt and leverage, as well as integration risk as Riddell Bell absorbs a company that is about two-thirds its size. The affirmation of the SGL-2 speculative grade rating reflects the good liquidity of Riddell Bell in its current form.

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