Moody’s might upgrade Huntsman

Moody's Investors Service said it placed the ratings of Huntsman Corp. and Huntsman International LLC under review for upgrade following the announcement that the company has agreed to undertake a merger of equals with Clariant AG (Ba1/negative). Huntsman and Huntsman International have Ba3 corporate family ratings and Ba3-PD probability of default ratings, Huntsman International’s senior secured credit Facility is rated Ba2 (LGD2), and its senior bonds are rated B1 (LGD5).

The agency also affirmed Huntsman's speculative-grade liquidity rating at SGL-2.

The companies expect the merger to be completed in the fourth quarter of 2017. Despite the merger announcement, Huntsman intends to complete the planned initial public offering of its pigments business (Venator LLC) over the next few months.

“The merger with Clariant will significantly increase Huntsman's size and diversity by adding a number of higher-margin specialty businesses including Catalysts and Care Chemicals," John Rogers, Moody’s senior vice president, said in a news release. "Additionally, the IPO of Huntsman's pigments business could generate substantial proceeds that could be used for deleveraging.

Moody’s said its review will focus on the combined company's ability to generate synergies and reduce debt prior to and in the first 12 to 18 months after the merger.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.