Moody’s cuts Northeast Biofuels rating on bankruptcy filing

15 January 2009 22:44  [Source: ICIS news]

HOUSTON (ICIS news)--Moody's Investors Service on Thursday downgraded Northeast Biofuels (NEB) to C from Caa1 after the ethanol maker filed for bankruptcy protection earlier this week.

A "C" rating is typically assigned to junk bonds with very low recovery potential.

Moody’s said NEB has failed to service debt in a “timely manner”, adding that approximately $148m (€112.5m) in senior secured debt was affected.

The ethanol maker has a plant in Fulton, New York, which has not reached completion due to a series of design flaws, Moody’s said.

NEB said on its website that bankruptcy was a “painful step”, but that its 114m gal/year facility has the potential to be profitable once necessary plant modifications are made.

For more on ethanol visit ICIS chemical intelligence
Bookmark Simon Robinson’s Big Biofuels Blog for some independent thinking on biofuels

By: William Lemos
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