Moody’s boosts Merck KGaA's outlook to 'positive'

20 February 2008 15:24  [Source: ICIS news]

TORONTO (ICIS news)--Moody’s has upgraded its outlook for the ratings of German specialty chemicals and pharmaceuticals maker Merck KGaA to "positive" from "stable", it said on Wednesday, adding it may upgrade the ratings going forward.

 

The change in outlook was prompted by Merck’s €4.9bn ($7.2bn) sale of its generics business to Mylan last year, an equity increase and increased cash flow generation, the credit watchdog said.

 

Moody’s currently rated Merck’s debt “Baa1”, reflecting the company’s diversification and improved profile following the acquisition of Serono which resulted in the addition of a profitable blockbuster multiple sclerosis treatment, Rebif, and an overall increased scale, it said.

 

In addition, Merck should continue to benefit from its strong market position in liquid crystals, the analysts said.

 

Moody's might upgrade Merck to “A3” if the company could further improve its credit metrics, it added.

 

($1 = €0.68)

By: Stefan Baumgarten
+1 713 525 2653

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