Moody's may cut Lumena

Moody's Investors Service said it placed the B2 corporate family and B2 senior unsecured bond ratings on Lumena Resources Corp. under review for possible downgrade.

The review follows news of Lumena's proposed acquisition of Sino Polymer New Materials Co., Ltd. The acquisition, valued at $1.5 billion, is designed to expand Lumena's downstream business, asset base, cash flow and add product diversity, the agency said.

The deal represents an aggressive expansion, as the target company is slightly bigger by revenue than Lumena, Moody's said.

In addition, the benefits of any potential synergies are yet to be established, as at present Sino Polymer does not rely on Lumena for its raw material supply to any material extent, the agency said.

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