The potential for unexpected DVD market erosion puts pressure on the Ba3 senior secured debt rating for Cinram International, states Moody's Investors Service in assessing a new $1.2 billion credit for the DVD, CD, videotape and audio cassette manufacturer. The deal backs Toronto-based Cinram's plans to acquire AOL Time Warner's DVD and CD business for $1.05 billion. "It's possible that the DVD business could come under some specific market pressures," said Donald Carter, v.p. and senior credit officer at Moody's. He explained that the possibility of DVD piracy, which would resemble the rampant piracy in the CD industry right now, does exist. "There have obviously been some pressures on the CD side of this business," he added.
September 07, 2003
