Solutia Chemical Co fka SOLUQ

[pkripper]

this is what we are upgrading from.

RATING ACTION: Moody's assigns Ba1 to Solutia's new asset backed bank facility; a B1 CFR; outlook stable
CREDIT: Solutia Inc.29 NOV 2007

Moody's assigns Ba1 to Solutia's new asset backed bank facility; a B1 CFR; outlook stable Assignments: Issuer: Solutia Inc. Corporate Family Rating, Assigned B1 Probability of Default Rating, Assigned B1 Speculative Grade Liquidity Rating, Assigned SGL-3 Senior Secured Bank Credit Facility, Assigned Ba1 (LGD2, 16%) Senior Secured Bank Term Loan, Assigned B1 (LGD4, 54%) Senior Unsecured Note, Assigned B2 (LGD4, 69%) The B1 corporate family rating reflects the company's initially high leverage and weak credit metrics along with the material uncertainty surrounding its environmental remediation activities upon exiting bankruptcy. VP - Senior Credit Officer Moody's Investors Service Moody's Investors Service


CREDIT OPINION: Solutia Inc.
CREDIT: Solutia Inc.

Solutia Inc. Liquidity Moody's Investors Service assigned a speculative grade liquidity rating of SGL-3 to Solutia. Moody's expects the company to generate positive free cash flow in 2008 approaching 5% of debt. The key rating factors currently influencing Solutia's rating and outlook are Management Strategy and Financial Strength. The third metric, Contingencies, maps to the "Caa" category and is overweighted in determining Solutia's ratings.Rating Factor - Business Profile: Moody's views Solutia as having an investment grade business profile with speculative grade leverage and capital structure. 30 NOV 2007


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