Moody’s lowers Ferroglobe

Moody’s Investors Service said it lowered to Caa1 from B3 Ferroglobe plc’s corporate family rating and to Caa1-PD from B3-PD its probability of default rating.

Moody’s also downgraded to Caa2 from Caa1 the senior unsecured rating assigned to the $350 million of senior unsecured notes issued by Ferroglobe and due 2022.

“The downgrade reflects Ferroglobe’s weak liquidity position in the absence of new debt financing arrangements in place and the continued weak operating performance in Q2 2019. Sharply fallen earning likely lead to a covenant breach as of 30 September 2019 under the company's revolving credit facility (RCF) if the breach is not waived or if the RCF is not replaced,” said Sven Reinke, a Moody’s senior vice president and lead analyst for Ferroglobe, in a press release.

The outlook is negative.

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