Moody's: Potlatch on upgrade review

Moody's Investors Service said it placed Potlatch Corp.'s Ba1 corporate family and Ba1 senior unsecured debt ratings on review for upgrade.

The review reflects Potlatch's signing of the new unsecured revolving credit facility replacing its existing secured line of credit, Moody's said.

As a result of this transaction, the REIT's valuable timberland portfolio has become fully unencumbered and its secured leverage has been eliminated, the agency said.

The new revolving credit agreement provides for a $250 million facility due December 2017, Moody's added.

During its review, Moody's said it will focus on the sustainability of the current strongly positive trends in the timber and lumber markets, as well as the impact of the gradual housing recovery and remaining macroeconomic uncertainty in the United States.

Counterbalancing these strengths, Potlatch remains the smallest timber REIT operating in a volatile commoditized industry where one of the major end markets - housing - continues to be weak, the agency said.

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