S&P puts Mauser Beteiligungs, parent on watch

Standard & Poor's said it placed its B+ long-term corporate credit ratings on Mauser Beteiligungs GmbH and Mauser Werke GmbH & Co. KG, the immediate parent company of Mauser's main operating subsidiaries on CreditWatch with negative implications.

At the same time, S&P placed its B- long-term senior unsecured debt rating on Mauser's €185 million notes due 2013 on CreditWatch with negative implications.

This follows the announcement that Mauser Werke has entered into an asset purchase agreement with Russell Stanley Holdings Inc.

The deal, which is expected to be closed within the next few months, will be mostly debt funded and could delay the expected improvement of the group's credit protection measures. At March 31, credit protection measures were already weak for the rating category, with annualized FFO to lease- and pension-adjusted total debt of about 12% and total debt to EBITDA of about 6x, S&P said.

S&P said it had been expecting the group to improve credit protection measures to total debt to EBITDA of about 4x in the short term through improvements in profitability via cost savings and synergies gained from other recent acquisitions.

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