Moody's cuts mg technologies to junk

Moody's Investors Service downgraded mg technologies ag to junk including cutting its Metallgesellschaft Finance BV's €300 million bonds to Ba1 from Baa3. The outlook is developing.

Moody's said the action balances the ultimate benefits to be gained from the announced sale of Dynamit Nobel for mg's future financial profile with the near-term challenges that mg may face during the transitional period of the group's strategic realignment process, including the challenge to conclude the proposed transaction within the targeted timeframe and at expected price levels.

It also reflects mg's lower profit and cash flow generation capability post-Dynamit Nobel that will likely be gradually expanded through selective investments going forward.

Moody's also noted the recent deterioration in the group's underlying performance including its weak cash flow generation over the past quarters, but assumes that mg will be able to generate a positive cash flow result in the second half year of 2003, notably in the traditionally strong fourth quarter.

The developing outlook reflects the transition period until completion of the Dynamit Nobel sale.

Moody's said successful disposal of Dynamit Nobel at around expected prices, supported by solid progress in achieving the targeted cost savings could lead to upward pressure on the outlook and ratings. On the other hand, should the company fail to demonstrate timely progress with respect to the asset sale and/or in case of a further deterioration in the underlying operational performance of the group's remaining businesses, this could lead to further pressure on the group's financial flexibility.

Moody's puts Alfa Bank, MDM, Bank Zenit on upgrade review

Moody's Investors Service put Alfa Bank's senior debt at B1, MDM Financial Group's senior debt at B1 and Bank Zenit's senior debt at B2 on review for possible upgrade.

Moody's said the action reflects the banks' strengthening franchises and improving financial performance.

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