Moody's cuts Asia Aluminum bonds to B2

Moody's Investors Service said it revised the outlook for Asia Aluminum Holdings Ltd.'s B1 corporate family rating to negative from stable, and downgraded its senior unsecured bond rating to B2 from B1.

The change in outlook reflects the slower than expected ramp-up of the company's flat-roll products facility, Moody's said, and the resulting delayed improvement to its financial profile.

The company's debt-to-EBITDA ratio in 2009 is expected to remain high at about 7-8x, the agency said.

The downgrade of the bond rating reflects structural subordination risk as both the company's subsidiary debt to total debt and total assets have increased in the past few years and were above 44% and 18% respectively as of fiscal year 2008, Moody's said.

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