Moody's affirms Kaydon

Moody's Investors Service said it affirmed Kaydon Corp.'s ratings, including the Ba2 corporate family rating and the Ba3 rating of the $200 million convertible senior subordinated notes while the outlook was also changed to stable from positive.

The rating affirmation reflects Moody's expectation that Kaydon's gross debt protection measures will remain strong in the intermediate term, partly offsetting the company's very small size, lack of geographic diversification and its exposure to volatile end-markets.

The change in outlook to stable factors in the expected gradual reduction of Kaydon's large cash balances through initiatives enhancing shareholders' returns, which together with moderate free cash flow generation in the near term, will somewhat lower the company's flexibility in its rating category, the agency added.

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