Moody's drops Stillwater Mining

Moody's Investors Service said it downgraded the corporate family rating of Stillwater Mining Co. to Caa1 from B3.

The outlook remains negative.

The agency said that the downgrade primarily reflects the company's ongoing challenges given Stillwater Mining's high cost structure and the current price environment.

The agency noted that Stillwater Mining has significant exposure to Ford Motor Co. (Caa1 - negative) and General Motors Corp. (Ca - negative), which are currently experiencing operating difficulties.

The downgrade to Caa1 considers that the company, in Moody's opinion, has entered a capital preservation mode as evidenced by Stillwater Mining's announced decision to reduce its capital spending and restructure its current operations, without which, it would have burned in excess of about $25 million per quarter.

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