Moody's may cut Tower Automotive

Moody's Investors Service said it placed all of the debt ratings pertaining to Tower Automotive Inc. and its wholly owned subsidiary R.J. Tower Corp. on review for possible downgrade. Moody's additionally affirmed Tower's weak SGL-4 speculative grade liquidity rating.

On review for downgrade are RJ Tower's B1 rated guaranteed first-lien senior secured credit facilities, B2 rated $155 million guaranteed second-lien senior secured synthetic letter of credit term loan facility, B3 rated $258 million 12% guaranteed senior unsecured notes due June 2013 and €150 million 9¼% guaranteed senior unsecured notes due August 2010, Tower Automotive's Caa3 rated $258.75 million 6.75% guaranteed trust convertible preferred securities due June 2018, B2 senior implied rating and Caa2 senior unsecured issuer rating.

Moody's said it placed Tower's debt ratings on review for possible downgrade due to the company's increasingly constrained liquidity, insufficient cash interest coverage by operating earnings and rising leverage.

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