Moody's lifts General Cable notes, rates convertibles B2

Moody's Investors Service said it upgraded General Cable Corp.'s $11 million senior unsecured convertible notes due 2012, $355 million senior unsecured convertible notes due 2013, $125 million senior unsecured floating-rate notes due 2015 and $200 million senior unsecured notes due 2017 to Ba3 (LGD4, 53%) from B1 (LGD4, 61%) and assigned a B2 (LGD6, 92%) rating to its $429.5 million subordinated convertible notes due 2029.

The agency also affirmed the corporate family and probability-of-default ratings at Ba3 and the speculative-grade liquidity rating at SGL-1.

The outlook is stable.

The company recently completed an exchange offer for its outstanding 1% senior convertible notes due 2012 in which it issued approximately $429.5 of the new convertibles due 2029. The agency said the upgrade is due to the subordinated debt added to the capital structure through the offer, which creates a layer of first loss absorption for the senior notes in a default scenario.

The Ba3 corporate family rating benefits from the company's leading market positions in the highly cyclical wire and cable industry, favorable longer-term demand trends, broad geographic diversity and very good liquidity, Moody's said.

The current economic downturn has sharply weakened demand for General Cable's products in many major end markets and created a difficult pricing environment, the agency said, but the credit metrics remain adequate for the rating category.

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