Fitch puts Pfleiderer on watch

Fitch Ratings said it placed Germany-based Pfleiderer AG's senior unsecured BB rating on Rating Watch negative. At the same time, the agency affirmed the company's short-term rating at B.

The rating action follows Pfleiderer's announcement that the group is using an exclusivity period to carry out a due diligence on the Kunz Group. Pfleiderer AG and Kunz Holding GmbH & Co. KG, Germany, signed a letter of intent on Dec. 6 for the possible acquisition of the Kunz Group by Pfleiderer.

Fitch said it assumes that the planned acquisition will have a major impact on the group's financial profile, which had gradually recovered over the past two years following a recovery in operational cash generation, as well as deleveraging, which has been driven by disposal proceeds following the exit of non-core operations.

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