Moody's may downgrade Cygnus

Moody's Investors Service said it placed all ratings of Cygnus Business Media Inc. on review for possible downgrade, including the B3 corporate family rating, B3 $30 million first-lien senior secured revolving credit facility due 2008, B3 $20 million first-lien senior secured delayed draw facility due 2008, B3 $140 million first-lien senior secured term loan B due 2010 and Caa1$30 million second-lien senior secured facility due 2010.

The rating action reflects Moody's concern regarding Cygnus's ability to maintain compliance with the covenants of its senior secured credit facility, the company's financial performance that has fallen short of expectations and the continuing payment of cash dividends to its parent, which has exacerbated an already constrained liquidity position.

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