| Add to balance / Manage account | User: | Log out |
| Prospect News home > News index > List of issuers Z > Headlines for ZF Friedrichshafen AG > News item |
S&P lowers ZF Friedrichshafen view to negative
S&P said it affirmed the BBB- long-term ratings on ZF Friedrichshafen AG, along with its senior unsecured debt.
The agency also revised the outlook to negative from stable.
ZF Friedrichshafen signed a definitive agreement to buy Wabco Inc. for about $8.5 billion, the agency said.
ZF plans to fund the acquisition through new debt, S&P said.
On a pro forma basis, the agency said it expects the acquisition to increase ZF's adjusted debt-to-EBITDA ratio to about 3.5x, from a forecasted 2x at year-end 2018, the agency said.
The acquisition of WABCO nicely complements ZF's product portfolio, S&P said.
ZF is expected to reduce leverage back toward 3x during the 24 months after closing, the agency said.
The negative outlook reflects the risk of a downgrade if increasingly difficult conditions in the automotive industry cause a further decline in ZF's operating margins and subsequently impair its ability to reduce leverage following the Wabco acquisition, S&P said.
© 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.