The ratings on Albany, N.Y.-based Momentive Performance Materials Inc. reflect its very high debt leverage and fair business risk profile. Momentive is a large producer of silicones used in a wide variety of applications and quartz used primarily in semiconductors. Beginning in the fourth quarter of 2008, the company's operating performance deteriorated sharply due to recessionary conditions and a big drop-off in customer orders across most businesses and geographies. Softness was particularly pronounced in the construction, auto, textile, and furniture markets. Management's initiatives to counter market weakness included plant closures, production curtailments, and headcount reductions that management expects will reduce annual operating costs by about $65 million. In addition, cash generation benefited from lower raw material costs during the first
