Moody's cuts Ply Gem notes to Caa2

Moody's Investors Service said it lowered Ply Gem Industries, Inc.'s proposed $500 million senior unsecured notes to Caa2 from Caa1 due to changes in the proposed capital structure.

Concurrently, the agency affirmed all other ratings, including B3 corporate family rating, B3-PD probability of default rating and B2 rating on the proposed $430 million term loan. The speculative-grade liquidity assessment was affirmed at SGL-2 and positive outlook was maintained.

Moody's said the change in the unsecured notes rating to Caa2 from Caa1 results from the company changing the allocation by $50 million between the term loan and the unsecured notes.

The unsecured notes are expected to decline to $500 million and the term loan to increase to $430 million. This $50 million allocation change will save Ply Gem $1.3 million in annual cash interest expense, Moody's said.

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