Moody's affirms Edgen

Moody's Investors Service said it affirmed the B3 rating on Edgen Corp.'s senior secured notes due 2011 as well as the B3 corporate family rating and the SGL-3 speculative-grade liquidity rating.

The outlook is stable.

Moody's noted the B3 corporate family rating reflects the modest scale of Edgen's operations, the uncertain long-term impact of its recent restructuring and integration efforts, the inherent cyclicality of the energy and industrial markets that use Edgen's specialized carbon and alloy pipe and the potential for margin compression given volatile steel prices and relatively slow-moving inventory.

The rating also incorporates the increased leverage associated with the announcement, relatively modest liquidity, minimal tangible asset coverage and the likelihood of acquisitions, the agency said.

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