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Moody's drops United Site
Moody's Investors Service said it downgraded the corporate family rating of United Site Services, Inc. to Caa1 from B3.
Moody's said it also downgraded the first-lien revolving credit facility to B1 from Ba3 and the second-lien term loan to Caa1 from B3.
The downgrade reflects the company's weak credit metrics, the potential for ongoing weak cash flows, and the prospects for a more severe economic downturn than the prior rating anticipated, the agency noted.
The downgrade also reflects Moody's concern that a protracted downturn in the residential/commercial construction market may continue to pressure the company's operating performance.
Notwithstanding the benefit of disaster related activity on the company's Sept. 2008 results, Moody's said it remains concerned that sales in the company's core construction-related business could remain under pressure.
Affected ratings include the company's $100 million senior secured first-lien revolving credit facility due 2012 to B1 (LGD1, 6%) from Ba3 (LGD1, 5%); and $265 million senior secured second-lien term loan due 2013 to Caa1 (LGD3, 47%) from B3 (LGD3, 45%).
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