12 June 2006 15:49 [Source: ICIS news]
LONDON (ICIS news)--UBS said on Monday it has upgraded its rating for Linde, the German engineering and industrial gases group, to neutral from reduce and raised its share price target by €4 to €66.00 on the back of increased performance compared with its peers.
Its upgrading followed the granting by the European Commission on 6 June of conditional approval to the £8.2bn ($15.3bn/€11.8bn) takeover by Linde of British rival BOC.
“While we acknowledge the strategic benefits of the takeover, we need to get comfortable with [the] future financing structure, impact of lower credit rating, level of engineering prepayments, cash conversion in gases, retainability of savings [and] monetisation of MatH assets, BOC's old UK asset base,” said UBS.
The bank said in a note to clients that Linde's fortunes were closely tied to those of broader capital markets.
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