Moody's downgrades Longview Fibre, rates loan Ba3

Moody's Investors Service said it lowered Longview Fibre Co.'s corporate family rating to B1 from Ba3, senior secured rating to Ba3 from Ba2, senior subordinated rating to B3 from B2 and senior unsecured rating to B2 from B1. Moody's also assigned a Ba3 rating to Longview's proposed senior secured term loan B facility. The outlook is negative.

The agency said the rating actions reflect the accelerated harvesting plan recently announced by Longview and the increased dividend level, in addition to the proposed leveraged recapitalization using secured debt and encumbering all of Longview's timberlands.

These negative rating factors are somewhat mitigated by the company's announced plans to monetize its higher and better use lands, as well as to rationalize its manufacturing plants, Moody's said.

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