S&P puts Securitas on watch

S&P said it placed Securitas AB’s BBB ratings on CreditWatch with negative implications after the company reported plans to buy Stanley Black & Decker’s electronic security business for about $3.2 billion. The agency expects Securitas to refinance the bridging facility secured for the deal.

“We anticipate that Securitas' leverage will increase if the company carries out the acquisition of Stanley Security. Although Securitas has secured a bridging facility to temporarily fund the acquisition, we anticipate that the company will replace this facility with a mix of newly issued debt and equity, which represent about 70% and 30% of the purchase price, respectively,” S&P said in a press release.

The agency said the CreditWatch indicates a one-in-two chance of a downgrade due to funds from operations to debt being below S&P’s 30% threshold.

S&P said it aims to resolve the CreditWatch after the deal closes, likely in mid-2022.

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