Moody's may lower Adesa

Moody's Investors Service said it placed the long-term debt ratings of Adesa, Inc. on review for a possible downgrade.

The review follows the company's announcement that it entered into a definitive agreement to be acquired by a group of private equity funds consisting of Kelso & Co., GS Capital Partners, an affiliate of Goldman Sachs, ValueAct Capital and Parthenon Capital, the agency said.

If no incremental debt is assumed, Moody's said it expects the combined entity to have adjusted debt to EBITDA of about 4 times and adjusted EBIT to interest coverage of about 3 times.

Affected ratings include the company's Ba2 corporate family rating, the Ba2 probability of default rating, the Ba1 (LGD3, 33%) rated $350 million senior secured revolver due 2010, the Ba1 (LGD3, 33%) rated $120 million senior secured term loan due 2010 and the B1 (LGD5, 87%) rated $125 million 7.625% senior subordinated notes due 2012 as well as the speculative-grade liquidity rating of SGL-1,

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