Moody's may lower ACCO Brands

Moody's Investors Service said it placed the long-term ratings of ACCO Brands Corp. under review for possible downgrade and affirmed the company's SGL-2 speculative-grade liquidity rating.

The review was prompted by Moody's concern that ACCO's pro forma earnings, adjusted for a full year of General Binding Corp., were materially weaker than expected, primarily due to the impact of higher raw material and freight/distribution costs and unfavorable pricing in certain categories of the office products group.

The review also reflects Moody's concern over the company's ability to sustain credit metrics consistent with a Ba3 ratings profile over the medium-term, given the potential for a more protracted realization of cost savings due to continued cost pressures and the complicated nature of the GBC integration, the agency noted.

Affected ratings include the corporate family rating at Ba3, senior secured revolving credit facility at Ba3, senior secured term loan A at Ba3, senior secured term loan B at Ba3 and senior subordinated notes at B2.

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