Moody's Investors Service Inc. has assigned Ba3 ratings to three senior secured bank facility tranches of National Gypsum Co.
The loans include a $300 million revolving credit facility, a $125 million term A loan, and a $275 million term B Loan.
The agency cited an increase in the company's debt following its takeover last year by Delcor Inc. and its recent emergence from bankruptcy. Moody's also pointed out that National Gypsum depends on a single product whose price is volatile.
It said that the banks' collateral package is "limited," and that the loan also could be affected by increased competition in the industry caused by a recent merger.
Moody's said the risks are moderated by the company's strong and historically stable market share, its relatively low costs, recent reductions in its work force, and improving conditions in its industry.