Moody's cuts Tempel Steel

Moody's Investors Services said it downgraded Tempel Steel Co.'s corporate family and probability of default ratings to Caa1 from B3.

The company's senior secured notes due 2016 have also been downgraded to Caa1 from B3.

The agency said the downgrade takes into consideration the company's weak performance, increasing leverage and the expectation for ongoing weakness.

The outlook was changed to negative from stable.

Tempel Steel's Caa1 rating reflects its weak business environment, declining revenues, weak interest coverage, high leverage and negative free cash flow, Moody's said.

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