Moody's downgrades Korreden

Moody's Investors Service said it downgraded to B1 from Ba3 the corporate family rating of Korreden SA, the holding company for Akerys, and to B3 (LGD5, 77.49%) from B1 the €300 million of senior floating-rate notes dues 2014 issued by Akerys Holdings SA. The company's probability-of-default rating is now B1.

The outlook is negative.

According to Moody's, the downgrades reflect further reduction in the number of reservations for Akerys' apartments and rising rate of cancellations for the third quarter.

The B1 corporate family rating reflects Akerys' leading position in the buy-to-let segment of the homebuilding market and its good geographic diversification, Moody's said.

Ratings also consider the supportive legal framework for homebuilding in France and the group's conservative risk-management guidelines, the agency noted.

Moody's said ratings could be downgraded if the issuer's net debt-to-EBITDA ratio rises above 6.5 times.

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