S&P keeps OMZ on negative watch

Standard & Poor's said it has kept its CCC+ long-term corporate credit ratings on Russia-based capital goods company OAO OMZ (Uralmash-Izhora Group) (OMZ) on CreditWatch with negative implications after obtaining new information on the company's liquidity position and business profile.

The CreditWatch implications were revised to negative from developing on Aug. 2 after OMZ's announcement of the cancellation of its merger with the Russian power-generation equipment producer Power Machines OJSC. The CreditWatch initially reflected the company's significantly impaired liquidity and S&P's concerns that OMZ's business and financial position could be damaged after the merger cancellation.

"Since that time, Standard & Poor's has obtained new information concerning OMZ's current business position, new management structure, strategy, financial policies, and liquidity," said S&P credit analyst Tatiana Kordyukova. "Our review will now be focused primarily on the company's liquidity situation, because OMZ's business profile seems consistent with the current rating level."

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