S&P revises Arkema to stable

S&P said it revised its outlook on Arkema SA to stable from negative and affirmed its BBB long-term and A-2 short-term corporate credit ratings.

At the same time, the agency affirmed the BBB long-term rating on Arkema's senior unsecured debt, the BB+ long-term rating on its €700 million subordinated hybrid securities and the A-2 short-term commercial paper rating.

S&P said the outlook revision reflects its expectation that Arkema will improve its ratio of adjusted funds from operations (FFO) to debt to 35% as of year-end 2016, which the agency views as commensurate with the current rating.

Arkema's operating performance was stronger than the agency expected in the first nine months of 2016, supported by a higher proportion of specialty chemicals in the portfolio, cost savings, development of the 2015 Bostik acquisition and realization of synergies with Arkema ahead of schedule and raw material tailwinds, S&P added.

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