Moody's drops Grohe view to negative

Moody's Investors Service said it changed the outlook on the ratings of Grohe Holding GmbH and subsidiary Grohe Beteiligungs GmbH to negative from stable following the release of the company's first-half 2005 results which showed a weakening in the company's credit metrics for the current rating category as a result of the continued difficult trading environment.

Affected ratings include the corporate family rating at B1, €900 million senior secured credit facilities also at B1 and €335 million 8 5/8% senior notes due 2014 at B3.

Moody's explained the negative rating outlook reflects Grohe's recorded decline in sales volume, which was only partially offset by improved pricing.

Moody's said the negative outlook for all of Grohe's ratings reflects the continued difficult market conditions that have impacted the company's margins and resulted in credit metrics that Moody's considers to be weak for the current rating category.

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