S&P: Rhodia on positive watch

Standard & Poor's said it placed the BB/B long- and short-term corporate credit ratings on Rhodia SA on CreditWatch with positive implications.

The positive CreditWatch follows Solvay's announced friendly 100% cash take-over bid on Rhodia for an enterprise value of €6.6 billion, S&P said. The transaction price represents a 50% premium on Rhodia's share price close on April 1.

The combined entity's business risk profile will likely be positioned in the high end of S&P's satisfactory classification, somewhat held back by more cyclical activities such as poly-amides, polyvinyl chloride and plastics, the agency said. Solvay and Rhodia combined would benefit from the entity's increased size and sales of over €12 billion, its broader product and end-market diversity as well as greater growth potential in emerging markets.

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