Moody's may cut Rock-Tenn

Moody's Investors Service said it placed Rock-Tenn Co.'s Baa3 senior unsecured ratings under review for possible downgrade.

Moody's said the rating action follows Rock-Tenn's announcement of a pending $540 million acquisition of the pulp, paperboard and paperboard packaging assets of Gulf States Paper Corp.

While the acquisition provides important diversification benefits into a business with relatively stable profit margins, Moody's said ongoing raw materials cost escalation has caused margin pressure in the company's core recycled paperboard business.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.