Moody's may cut Manor Care to junk

Moody's Investors Service said it placed the Baa3 senior unsecured notes of Manor Care, Inc. under review for possible downgrade following the announcement that the company had entered into a definitive agreement to be acquired by the Carlyle Group. The transaction is subject to regulatory and shareholder approvals and is expected to close in the fourth quarter of 2007.

The agency's review will focus primarily on the level of financial leverage used to complete the transaction, which has been valued at $6.3 billion including $950 million of existing debt. The review will also consider the resulting capital and corporate structure as those details become available, Moody's added.

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