Moody's may cut Rock-Tenn

Moody's Investors Service said it placed on review for possible downgrade Rock-Tenn Co.'s Ba1 corporate family rating and Ba1 probability of default rating, Baa3 senior secured bank credit facility rating and Ba2 senior unsecured regular bond/debenture rating.

The review was prompted by news that Rock-Tenn has agreed to acquire Smurfit-Stone Container Corp., Moody's said.

The review will focus on the amount of acquisition debt financing taken on to fund the transaction, Moody's said, the size and pace of any cost synergies that can be realized.

The review also will consider Smurfit-Stone's large unfunded pension liability and Rock Tenn's ability to maintain adequate liquidity, the agency said.

If the deal closes, Moody's also said it will withdraw the ratings on Smurfit-Stone.

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