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Moody's upgrades GKN Holdings
Moody's Investors Service said it upgraded the senior unsecured debt ratings on GKN Holdings Ltd. to Ba1 from Ba2.
The company is owned by Melrose Industries plc.
Moody's also said it withdrew GKN's corporate family rating of Ba1, the provisional Ba2 on the senior unsecured medium-term notes program rating and probability of default rating of Ba1-PD.
The outlook is stable.
The upgrades reflect the elimination of the structural subordination of the instruments due to the parental guarantees provided by Melrose, Moody's said.
The credit quality of the notes is now closely linked to the one of Melrose, the agency said.
Moody's said it does not expect to have sufficient information for GKN's ratings anymore.
The ratings are supported by the company's end market diversification, positive exposure to the growing adoption of alternative fuel vehicles and strong position in selected niche markets, such as ice protection and fuel systems, the agency said.
The ratings are constrained by its exposure to the cyclicality of production rates in the automotive and aerospace industry, as well as strong competition in both markets, Moody's said.
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