Moody’s cuts Algeco Scotsman, debt to Caa2

Moody's Investors Service said it downgraded Algeco Scotsman Global Sarl's corporate family rating and Algeco Scotsman Global Finance plc's senior secured to Caa2 from Caa1, and affirmed Algeco Scotsman Global Finance’s senior unsecured rating at Caa3.

The rating outlook remains negative.

Moody’s said the downgrade reflects the increased risk of default presented by Algeco's weak liquidity and weak capital structure, with large amounts of debt representing leverage of about 9 times based on trailing 12-month EBITDA, and negative shareholders' equity.

The agency views Algeco's capital structure as unsustainable, presenting a high risk of a distressed exchange that could result from potential debt restructuring, which could impose meaningful losses on the company's bondholders.

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