Moody's: Viasystems outlook positive

Moody's Investors Service said it assigned a B3 rating (LGD3, 45%) to Viasystems, Inc.'s $220 million senior secured note issuance, changed the outlook to positive from negative and affirmed the corporate family and probability-of-default ratings at B3.

Viasystems plans to use the proceeds of the note offering to purchase the outstanding $200 million senior subordinated notes due January 2011 via a tender offer.

The change in outlook reflects Viasystems' refinancing of its senior subordinated notes in addition to moderate improvement in operating margins as the company starts to reap the benefits of its 2008 restructuring initiatives, according to the agency.

Moody's said it expects adjusted debt-to-EBITDA ratio to improve to less than 3x over time, compared with 4.3x for Viasystems on a standalone basis for the 12 months ended Sept. 30.

Viasystems' B3 corporate family rating reflects concerns about the relative lack of scale and customer concentration, the agency said, as well as its exposure to the volatile telecommunications and automotive end markets.

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