Moody's eyes Storskogen downgrade

Moody's Investors Service said it placed of Storskogen Group AB’s Ba1 ratings on review for downgrade. Concurrently, the agency changed the outlook to ratings under review from stable.

“The action to place the Ba1 rating of Storskogen on review for downgrade was driven by Moody's concerns over (i) the company's financial policy with regards to leverage and liquidity and its ability to restore key credit metrics commensurate for the Ba1 rating; (ii) increased financing costs and a difficult market environment to access long term funding compared to when the rating was assigned in March this year and (iii) the recent restructuring of the company CEO's leveraged holdings of Storskogen shares that could potentially elevate the risks of an aggressive investment strategy that benefits shareholders over creditors,” the agency said in a press release.

Moody’s said the review will concentrate on Storskogen's ability to balance higher interest costs by consolidating its investment portfolio and increasing its cash flow.

Moody's said it aims to conclude the review within the next three months.

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