Moody's rates Dana notes B3

Moody's Investors Service said it assigned a B3 (LGD 5, 88%) rating to Dana Holding Corp.'s new senior unsecured notes, including its senior unguaranteed eight-year notes and senior unguaranteed 10-year notes.

The agency also said it affirmed its corporate family and probability of default ratings at B1, along with the Ba1 (LGD 1, 8%) rating that was assigned to its amended and extended senior secured asset-based revolving credit facility.

This action follows news that Dana is offering $700 million of senior unsecured notes to be used, along with cash on hand, to repay its existing senior secured term loan, Moody's said.

The company also will amend and extend its existing asset-based revolving credit facility, the agency said. The amended revolving credit facility will have a reduced commitment amount of $500 million down from $650 million, the agency said.

The affirmations continues to anticipate an improving near-term earnings outlook as increased revenues from rising auto production volumes are leveraged by the operating efficiencies from the company's restructuring initiatives, Moody's said.

A lower amount of funded debt also should support modestly stronger credit metrics, the agency said.

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