S&P rates Geberit converts

Standard & Poor's said it assigned its BBB- senior unsecured debt rating to the proposed convertible bonds of up to SFR170 million due on June 14, 2010 issued by Switzerland-based sanitary and plumbing manufacturer Geberit AG (BBB/stable/--).

"The debt rating on the proposed bonds is one notch lower than the long-term corporate credit rating on Geberit, reflecting its structural subordination to operating subsidiaries' liabilities," said S&P credit analyst Eve Greb. "The ratio of priority liabilities to total assets is above 30%, which is above our 20% threshold warranting the one-notch differential."

S&P said it expects Geberit to use the proceeds of the bond issue to refinance a part of the bridge loan agreement of €200 million, which the company signed in December 2003 to finance the acquisition of Germany-based Mapress.

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