Moody's confirms Universal

Moody's Investors Service said it confirmed Universal Corp.'s Ba1 corporate family and senior unsecured debt ratings and the prospective Ba1 rating on its senior unsecured shelf.

The outlook is negative.

The confirmation is based on the elimination of a series of financial uncertainties faced by Universal including the resolution of its financing plans and the potential benefit derived from asset sales, Moody's said.

In confirming the company's long-term ratings, the agency considered the significant debt reduction achieved through the recent issuance of approximately $220 million in preferred stock as well as Moody's expectation that substantially all of the proceeds from sale of the company's non-tobacco operations, expected to close within the next two months, will be used to repay additional debt.

Universal's negative outlook reflects the on-going volatility risk to the company's profitability and cash flow due to current difficult supply conditions in many of the markets in which the company operates, the agency noted.

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