The speculative grade liquidity rating of Owens-Illinois, Inc. has been lowered to SGL-3 from SGL-2 by Moody“s Investors Service. The change is related to the scheduled expiry of an accounts receivab…
The speculative grade liquidity rating of Owens-Illinois, Inc. has been lowered to SGL-3 from SGL-2 by Moody“s Investors Service. The change is related to the scheduled expiry of an accounts receivable program in September 2006 and the expected reduction of cushion under financial covenants caused by a combination of higher costs putting pressure on cash flow and covenant step-downs included in the agreement for the secured credit facility. The SGL-3 rating reflects the rating agency“s expectation that O-I will have sufficient liquidity through the four quarters ending 31 March 2007. The rating incorporates Moody“s expectations of a maturing accounts receivable securitization program, predicted reliance on O-I“s revolver during the seasonal high for working capital during the 2Q of 2006, and modest cushion under financial covenants. The rating could be raised if O-I is successful in extending its securitization program, gains greater cushion under its financial covenants, or otherwise improves liquidity.