Moody's cuts Georgia Gulf

Moody's Investors Service said it downgraded Georgia Gulf Corp.'s corporate family and probability-of-default ratings to B3 from B1. The agency also downgraded the company's secured revolver and term loan to Ba3 (LGD2, 23%), its unsecured notes to Caa1 (LGD5, 71%) and its subordinated notes to Caa2 (LGD6, 93%).

The outlook is negative.

According to the agency, the downgrade reflect concerns over the company's ability to maintain compliance with tightening financial covenants in its bank facility combined with the difficult conditions in the high-yield loan and debt markets.

Ratings reflect continuing weak financial performance due to the downturn in the U.S. housing market, uncertainty about the length or depth of the downturn and the potential U.S. consumer-led recession in 2008, Moody's said.

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