S&P puts KraussMaffei on positive watch

Standard & Poor’s said it placed the B+ long-term corporate credit rating on KraussMaffei Group GmbH on CreditWatch with positive implications.

The agency also said it placed the B rating on KraussMaffei Group’s €325 million senior secured notes with a carrying amount of €260 million on CreditWatch positive.

The recovery rating remains at 5, reflecting 10% to 30% expected default recovery.

The CreditWatch placement follows news that China National Chemical Corp. (ChemChina) intends to acquire KraussMaffei Group from its private equity owner, Onex, S&P said.

The transaction values KraussMaffei Group at €925 million and is subject to regulatory approvals, which are expected to be completed during the first half of 2016, the agency said.

S&P said it expects that KraussMaffei Group’s credit profile may benefit from the acquisition by the financially stronger ChemChina.

Even if the acquisition is 100% debt funded, the agency said ChemChina’s BBB group credit profile will not be immediately affected.

S&P said it will assess KraussMaffei’s strategic importance to ChemChina in order to form a view on its credit quality after the transaction.

© 2015 Prospect News.
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