Moody's lowers Boise Cascade

Moody's Investors Service said it downgraded Boise Cascade LLC's corporate family rating to B2 from Ba3 and its senior subordinated notes to Caa1 (LGD5, 83%) from B2.

The action reflects depressed demand for wood based building products, sizable losses in the current environment and the anticipation that the company's cash burn will increase from prior expectations, according to the agency.

The company's speculative grade liquidity rating was also downgraded to SGL-3 from SGL-2.

The outlook is stable.

Moody's said the downgrade considers its belief that the wood based building product sector will worsen as both demand and pricing will continue to decline amid global economic weakness.

The B2 corporate family rating reflects the company's strong market position as a buildings material distributor and wood products producer in North America, the agency said.

Ratings also reflect the potential for cost improvements over the intermediate term due to recent rationalization actions and reduced raw material and energy costs, the agency noted.

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