S&P may lower Baxi

Standard & Poor's said it placed all of its ratings - including its BB- long-term corporate credit rating - on Baxi (Holdings) Ltd. on CreditWatch with negative implications following the group's announcement that its owner, BC Partners, has agreed to acquire the heating business of Corporacion Empresarial Roca SA for €200 million with a view to combining Roca and Baxi.

S&P said the negative CreditWatch implications reflect the current uncertainty with respect to the ultimate financial structure that will be employed for the combined group and the possibility that it might result in higher leverage or weaker credit-protection measures, which could result in a lowering of the rating.

S&P noted, however, that the combined business is likely to benefit from a greater geographical and customer diversification.

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