LONDON (Bloomberg) ? Sea Containers Ltd., a rail-and- shipping company whose debt is rated nine steps below investment grade, had its bonds rated a ?buy? in new coverage by Dahlman Rose & Co. LLC.

The Bermuda-registered company said on June 12 it would breach the conditions of the bonds by retaining the proceeds of a sale of shares in its Orient Express Hotels subsidiary. The terms of Sea Containers? bonds require that the proceeds from asset sales are used either to repay debt or buy new assets within six months.

?Although the company is facing a near-term liquidity crunch and other financial and legal problems, there is sufficient asset coverage on the company?s bonds,? Dahlman Rose analyst Joseph McGrath wrote in a note from New York yesterday.