DBRS Places Norbord Senior Secured Notes Under Review-Negative Following Change to Methodology

DBRS has today placed the ratings of the Senior Secured Notes (the Secured Notes) of Norbord Inc. and Norbord (Delaware) GP I (collectively, Norbord or the Company) Under Review with Negative Implications. This action follows DBRS’s update of its methodology “DBRS Recovery Ratings for Non-Investment Grade Corporate Issuers” (formerly entitled “DBRS Criteria: Rating Leveraged Finance”), which has restricted the notching of instrument ratings for companies rated in the BB range to those with recovery ratings of RR2 and above (see the DBRS press release dated January 14, 2013, for details). The Issuer Rating and Senior Unsecured Notes ratings of Norbord are unaffected and remain at BB (low) and B, respectively, all with Stable trends.

The current recovery ratings on the Secured Notes of Norbord are and remain RR3. However, in accordance with the updated methodology, an RR3 recovery rating will no longer receive a one-notch uplift from the Issuer Rating, as was the case previously. In our review of Norbord’s Secured Notes ratings, DBRS will update its assessment of the recovery potential of the Secured Notes and the resultant instrument rating based on the latest methodology.

DBRS has also discontinued the rating on Norbord’s Secured Debentures, which were repaid on July 1, 2012.

Notes:
All figures are in U.S. dollars unless otherwise noted.

The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link to the right under Related Research or by contacting us at info@dbrs.com.

The applicable methodologies are DBRS Recovery Ratings for Non-Investment Grade Corporate Issuers (January 2013) and Rating the Forest Products Industry (June 2011), which can be found on our website under Methodologies.