Moody's cuts Wellman view to negative

Moody's Investors Service said it confirmed the B3 corporate family rating for Wellman, Inc., along with its probability of default rating at B3, the $185 million first-lien term loan due 2009 at B1 (LGD3, 31%) and $265 million second-lien term loan due 2010 at Caa1 (LGD5, 78%).

The outlook was revised to negative from stable.

This concludes the review that started in November when Wellman's corporate family rating was downgraded to B3 from B2 and kept under review for further downgrade.

The confirmation reflects the improving operating environment for the company's products and ongoing efforts to restructure its business, which should provide increased financial flexibility, the agency said.

The negative outlook reflects uncertainty about Wellman's ability to improve its low margins, operating losses and to maintain at least $45 million of availability under its revolving credit facility, Moody's said.

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