Moody's drops Owens Corning

Moody's Investors Service said it downgraded the debt ratings of Owens Corning to Ba1.

The agency said that the ratings downgrade was prompted by the adverse effects of the homebuilding contraction on Owens Corning's financial performance and credit profile.

At the same time, Moody's said that a corporate family rating of Ba1 and a speculative-grade liquidity rating of SGL-2 were assigned.

The outlook is negative.

The agency said that the following debt ratings were downgraded or assigned: $1 billion Revolving Credit Facility, due 2011, downgraded to Ba1 (LGD4, 55%) from Baa3, $600 million term loan, due 2011, downgraded to Ba1 (LGD4, 55%) from Baa3, $650 million 6.5% senior Unsecured notes, due 2016, downgraded to Ba1 (LGD4, 55%) from Baa3, $550 million 7.0% senior Unsecured notes, due 2036, downgraded to Ba1 (LGD4, 55%) from Baa3, corporate family rating, assigned at Ba1 and speculative-grade liquidity rating, assigned at SGL-2.

According to Moody's, the ratings downgrade reflects the company's financial performance and weak outlook due to the homebuilding contraction.

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