Moody's lowers AMF Bowling

Moody's Investors Service said it downgraded the ratings of AMF Bowling Worldwide, Inc., thus concluding the review of the ratings for possible downgrade initiated on March 10.

The agency said it lowered to Caa1 from B3 the $150 million 10% senior subordinated notes due 2010 to B2 from B1 about $120 million senior secured credit facility, consisting of a $40 million revolver due 2009 and about $79 million term B loans maturing in 2009 and to B2 from B1 the corporate family rating.

Moody's said it anticipates negative to breakeven consolidated free cash flow throughout the intermediate term under a reasonable base case projection, despite AMF's efforts to right-size operations, bolster the quality of its products and services and to improve profitability.

The downgrade reflects the cumulative impairment of AMF's financial profile caused primarily by declining bowling activity, less than optimal pricing and increased competition, the agency noted.

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