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Moody“s cuts Brunner Mond Group to Caa2 from Caa1

Moody“s Investors Service has lowered the rating on the bonds of Brunner Mond Group PLC from Caa1 to Caa2.
The senior implied rating of Brunner Mond Group PLC has been lowered from B2 to B3 and the …

Moody“s Investors Service has lowered the rating on the bonds of Brunner Mond Group PLC from Caa1 to Caa2. The senior implied rating of Brunner Mond Group PLC has been lowered from B2 to B3 and the senior unsecured issuer rating of the same entity has been reduced from B3 to Caa1. This rating action reflects concerns about already weak debt protection measures for 1999 weakening further during 2000 as a result of eroding prices and high global excess capacities in soda ash. Moody“s said its rating action reflects concerns about the weak pricing outlook for soda ash driven by excess global capacity and competitive inroads by US and Eastern European suppliers. The outlook beyond the year 2000 will continue to reflect a mature market for glass, the biggest consumer of soda ash, with sustained inroads by plastic substitutes as well as recycling and lower-weight glass in the container glass segment, that will likely limit developed market volume growth to under 1%. In addition, Moody“s said it expects substantial further low-cost natural soda ash capacities to come onstream in North America in 2001-3 and continued uncertainty regarding pricing from Chinese producers that will likely limit any upward price movement potential from the recovering economic environment in Europe.

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