Agency downgrades auto supplier’s credit rating

Beleaguered auto parts supplier Collins & Aikman received another blow as Moody’s Investors Service Corp. downgraded the company’s credit and debt. The announcement came after C&A launched a massive restructuring effort two weeks ago intended to turn around the company’s financial fortunes. The debt and credit downgrade also came amongst reports that suppliers of raw materials and parts to the company are demanding cash prior to delivery.
Moody’s cited a number of reasons for the downgrade, including an on-going investigation of payments to two of Collin’s & Aikman’s board members, as well as the pending outcome of an audit being conducted by KMPG.
New C&A CEO David Stockman denied his company was having problems with its suppliers, according to a report published in the Detroit Free Press.