Moody's cuts BCP Caylux

Moody's Investors Service said it downgraded the senior implied rating of BCP Caylux Holdings Luxembourg SCA to B1 from Ba3 following the company's announcement that it will issue an additional $225 million of senior subordinated notes to repay €165 million of PIK notes at Blackstone Crystal Holdings Capital Partners (Cayman) IV Ltd. BCP is owned by an affiliate of The Blackstone Group.

The outlook is stable.

More specifically, Moody's downgraded BCP Caylux Holdings Luxemburg SCA's senior implied rating to B1 from Ba3, €313 million guaranteed senior secured revolver due 2009 to Ba3 from Ba2, €187 million guaranteed senior secured credit-linked revolver due 2009 to Ba3 from Ba2, €500 million guaranteed senior secured term loan B due 2011 to Ba3 from Ba2, €350 million guaranteed senior secured term loan C due 2011 to B2 from B1, senior unsecured issuer rating to B2 from B1, and €1.22 billion of U.S. dollar- and euro-denominated guaranteed senior subordinated notes due 2014 to B3 from B2.

Moody's also changed CNA Holdings Inc.'s senior unsecured rating to B1 from Ba3.

Moody's said the downgrade reflects BCP's willingness to add additional cash-pay debt in order to repay existing PIK notes. Moody's prior analysis had recognized BCP's ability to add additional debt but had anticipated that the company would exercise restraint and focus on improving credit metrics.

The ratings take into account BCP's increased leverage, especially for a cyclical commodity producer with pro forma debt to EBITDA, adjusted for the debt offering and certain expenses, of 5.4 times for the last 12 months ended March 31, 2004.

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