Moody's downgrades USG's debt ratings

NEW YORK - Moody's Investors Service on Friday downgraded some of USG Corp.'s debt ratings to junk status due to revenue and margin pressure caused by sharp contraction in the new home construction market.

The ratings agency downgraded the building products manufacturer's $650 million revolving credit facility to speculative grade "B1" from investment grade "Baa2." It also lowered USG's speculative grade ratings by one notch on its $500 million senior notes due 2016 to "B1" from "Ba2" and $500 million senior notes due 2018 to "B1" from "Ba2," respectively.

At the same time, Moody's downgraded the company's speculative grade liquidity rating to SGL-3 from SGL-2.

The company's outlook remains negative because of continued pressure on the company's financial performance, said the ratings agency.

"The company's performance will likely remain under pressure until the new home market stabilizes and consumers are more willing, and able, to invest in their homes," said Moody's.

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