Fitch lowers Honeywell outlook to negative

Fitch Ratings said it revised the outlook for Honeywell International Inc. to negative from stable.

The revision follows Honeywell's announcement on April 4 that it has agreed to acquire Norcross Safety Products LLC for $1.2 billion, which is likely to be financed with a combination of cash and debt, the agency said.

Any additional debt used to fund the purchase of Norcross will increase Honeywell's debt and financial leverage, which Fitch said it already considered to be high for Honeywell's ratings, which are: issuer default rating at A+, senior unsecured bank credit facilities A+, senior unsecured debt A+, short-term issuer default rating F1 and commercial paper F1.

According to the agency, Honeywell's leverage reflects an active acquisition program as well as aggressive share repurchases, including nearly $3.4 billion of repurchases in 2007 and the pending acquisition can be expected to temporarily delay an improvement in Honeywell's credit measures.

© 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.