Moody's downgrades Keane

Moody's Investors Service said it lowered Keane International Inc.'s corporate family and probability-of-default ratings to B2 from B1.

The agency lowered $50 million revolving credit facility due 2013, $45 million synthetic letter of credit facility due 2013 and $600 million first-lien term loan due 2013 to B2 (LGD3, 46%) from B1 (LGD3, 48%).

The outlook is stable.

The downgrade reflects the company's weaker-than-expected financial performance resulting in weaker credit metrics and expectations of continued pressure on revenues and profitability in a weak macro economic environment, according to the agency.

The rating is constrained by expectation that Keane will continue to experience pressure in its revenues and profitability due to continued weakness and uncertainty in the overall macro environment, which could curb end-market demand for the company's services offerings among financial institution customers and prospects, the agency said.

The rating is supported by Keane's good market position with comprehensive service offerings and a balanced near-shore/off-shore strategy in a large IT services market and its good liquidity profile, the agency noted.

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