16 September 2008 06:14 [Source: ICIS news]
SINGAPORE (ICIS news)--Moody’s Investors Service may downgrade the credit ratings of German chemicals firm BASF as the company explores financial options to fund its Swiss franc (Swfr) 6.1bn ($5.5bn/€3.9bn) takeover bid for Ciba, the ratings agency said on Tuesday.
Ciba’s ratings were also placed under review on concerns about the company’s financial flexibility upon acquisition and questions about its ability to reverse its falling operating margins.
Moody’s said BASF faced a challenging operating environment given weaker demand and rising raw material prices in its chemicals, plastics and functional chemicals products.
BASF’s ratings will be evaluated based on its liability structure following the takeover, the ratings firm said, adding that the company currently had an ‘Aa3’ rating for senior unsecured debts.
BASF had global sales of around euro (€)58bn ($ 82.5bn) in 2007.
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