S&P revises Prysmian outlook to negative

S&P said it revised its outlook on Prysmian SpA to negative from stable and affirmed the BBB- issuer credit rating.

Prysmian announced it entered into a definitive agreement to acquire Encore Wire Corp. for $290 per share, implying an enterprise value of close to $4.2 billion. The acquisition will be financed with debt of €3.4 billion and available cash balances of about €1.1 billion, S&P said.

“Upon transaction closing, the company’s credit metrics will be weak for the BBB- rating and we anticipate that the company will not have any rating leeway for operating underperformance or further debt-financed acquisitions,” S&P said in a news release.

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