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Fitch: ITT unchanged
Fitch Ratings said that ITT Corp.'s announced acquisition of Godwin Pumps will not impact the company's ratings.
Earlier, ITT announced an agreement to acquire Godwin for about $585 million, the agency said, adding that the acquisition is expected to close in the third quarter of 2010.
Fitch said it expects ITT to fund a majority of the acquisition through the issuance of Commercial Paper, which will lead to an increase in leverage.
According to the agency, debt reduction in the prior year had helped to offset the negative impact of weaker operating results in ITT's industrial businesses related to the recession.
As a result, ITT's debt/EBITDA as of the 12 months ended March 31 was 1.1 times, but is expected by Fitch to increase to over 1.3x once the acquisition is complete.
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