S&P puts Aleris on negative watch

Standard & Poor's said it placed Aleris International Inc.'s BB- corporate credit, B+ senior secured debt and B senior unsecured debt ratings on CreditWatch with negative implications following the announcement that Aleris has entered into a non-binding letter of intent to acquire the downstream aluminum operations of Corus Group plc (BB-/positive watch/B) for about $840 million plus the assumption of €28 million of debt and €98 million of debt-like pension liabilities. S&P predicted that the majority of the financing to be in the form of debt.

In resolving its Credit Watch, S&P said it will review the potential acquisition's impact on Aleris' business and financial profile, capital structure and financial policy, as this is Aleris' fifth acquisition since December 2004 when it was formed through IMCO Recycling Inc.'s acquisition of Commonwealth Industries Inc.

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