Moody's confirms ATU

Moody's Investors Service said it confirmed the corporate family and probability-of-default ratings of ATU Auto-Teile-Unger Investment GmbH & Co. KG at Caa1 and its €150 million senior notes at Caa3 (LGD5, 88%).

The outlook is stable.

This concludes the review, direction uncertain, began on Jan. 11, following further operating performance erosion during the fourth quarter, according to Moody's.

The confirmation with a stable outlook was prompted by ATU's announcement of an amendment to its capital structure with the key element being an equity injection of €140 million from shareholders KKR and Doughty Hanson that will largely be used to repay senior debt and provide additional liquidity, the agency said.

The rating continues to reflect the erosion of ATU's earnings in recent years which eventually resulted in a high leverage of 7.4 times debt to EBITDA as per fiscal year-end 2007, the agency said.

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