S&P: Dura Automotive on watch

Standard & Poor's said it placed its BB- corporate credit rating on Dura Automotive Systems Inc. on CreditWatch negative, reflecting concerns about Dura's ability to improve earnings and cash flow and reduce its high debt leverage, given challenging industry conditions.

S&P also placed on watch Dura's BB senior secured debt rating, B+ senior unsecured debt rating, and B subordinated debt rating.

S&P said reduced vehicle production, higher raw material costs and intense pricing pressure from customers with deteriorating market shares is pressuring Dura's operating performance.

Meanwhile Dura's balance sheet remains highly leveraged, resulting from several acquisitions in recent years. Total debt to EBITDA is about 5.9x (5.5x when cash in excess of $50 million is applied to debt).

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