Moody's may upgrade Williams Scotsman

Moody's Investors Service said it placed Williams Scotsman International, Inc.'s B2 corporate family rating, B2 senior secured credit facility and B3 senior unsecured notes on review for possible upgrade due to the company's continued strong performance, supported by substantial increases in average lease rates with stable utilization. This has resulted in greater cash flow generation, causing leverage metrics to improve to the strongest levels since the equity initial public offering in September 2005.

The agency said management's commitment to a more conservative leverage profile since the IPO is a key driver in the review decision. This has been evidenced by a disciplined approach regarding the usage of debt for both organic growth and acquisitions, in addition to a secondary equity offering in the second quarter of 2006 that was used in part to reduce outstandings under the company's revolving credit facility.

During the review, Moody's will analyze the sustainability of Williams Scotsman's recent strong operating performance, analyze whether there has been a structural shift in the firm's business model so that cyclical troughs will generate less stress on the company's earnings and cash flows and review the firm's leasing versus sales mix and the characteristics of each.

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