Fitch ups Aon outlook to stable

Fitch Ratings said it revised Aon Corp.'s outlook to stable from negative and affirmed its BBB+ rating on the $300 million 3.5% senior debt due 2012, BBB+ rating on the $250 million 6.2% senior debt due 2007, BBB+ rating on the $225 million 7.375% senior debt due 2012, BBB+ long-term issuer rating, F2 commercial paper and Aon Capital A's BBB rating on the $726 million 8.205% trust preferred capital securities due 2027.

The revised stable outlook reflects Aon's progress in developing a new business model that is less reliant on contingent commission income, the company's improved financial flexibility and positive financial trends and a lack of any additional broker market turmoil, the agency said.

Over the past year, Aon has proven its ability to retain clients and grow new business while improving profitability, the agency said. The company reduced its financial leverage by repaying debt and has no debt maturing until 2007.

Fitch said that, since Aon's settlement with the New York Attorney General in March 2005, the company has executed its stated strategic plans as projected: Aon hired a new CEO, announced a three-year restructuring plan projected to bring $150 million in annualized cost savings, sold its claims and wholesale brokerage businesses, divested its stake in Endurance Specialty Holdings Ltd. and is now exploring strategic alternatives for its property and casualty, warranty businesses.

© 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.