S&P affirms Diagnosticos da America

Standard & Poor's said it affirmed Diagnosticos da America SA's BB global scale and brAA- Brazilian national scale corporate credit ratings.

The outlook remains stable.

The agency said it believes the company's operating margins will keep improving on a slower pace of acquisitions and increased focus on integrating and capturing synergies from its expanded asset portfolio.

S&P said it expects the company will remain acquisitive, but focused on smaller businesses that add to its existing portfolio and allow for quick turnaround of operations.

The ratings reflect the challenges to integrate acquired laboratories into its operating model and its exposure to the competitive and fragmented diagnostics industry, one with relatively low barriers to entry, the agency said.

The company's market leadership in Brazil, quality improvements in its clinical and image diagnostics operations, efficient multi-brand platform and increasing business diversification by region, customer and income level partially mitigate these risks, S&P said.

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