Moody’s downgrades Galapagos, notes

Moody's Investors Service said it downgraded Galapagos Holding SA’s corporate family rating to B3 from B2 and probability of default rating to B3-PD from B2-PD.

Additionally, the agency downgraded the rating pertaining to the senior unsecured notes of Galapagos to Caa2 from Caa1 and the rating pertaining to the senior secured notes issued by Galapagos SA, a subsidiary of Galapagos, to B2 from B1.

The outlook on all ratings was changed to stable from negative.

"The downgrade primarily reflects Galapagos' elevated leverage in conjunction with sustained weakness in the group's major end markets," Scott Phillips, Moody's vice president, senior analyst and lead analyst for Galapagos, said in a news release.

"The reduction in financial debt following the sale of DencoHappel is not enough to offset the expected weakness in earnings in 2017."

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