Moody's ups Metallurg

Moody's Investors Service said it raised the ratings of Metallurg Inc. and its parent, Metallurg Holdings Inc., including the senior implied rating to Caa1 from Caa3, $40.3 million 12.75% senior discount notes series B due 2008 to Ca from C, the issuer rating to Ca from C and $100 million 11% guaranteed notes series B due 2007 to Caa2 from Ca.

The outlook was changed to stable from negative.

Moody's noted the company's improved operating margins that signal a return to positive cash flow and the potential reduction of at least a portion of its very expensive debt.

Offsetting the improvements, the agency added, are earnings that are still subject to commodity pricing pressures, mounting interest expenses and moderate enterprise value.

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