S&P cuts INEOS rating on weak markets

23 January 2009 18:54  [Source: ICIS news]

TORONTO (ICIS news)--Credit agency Standard & Poor's (S&P) has lowered its long-term corporate rating for UK-based chemicals major INEOS to reflect “unprecedented weak market conditions” for petrochemical companies in the 2008 fourth quarter and the weak outlook for 2009, it said on Friday.

S&P lowered the rating to “CCC”, from “B-“, with a negative outlook.

The tough markets could result in severe liquidity pressure for INEOS, which already had a highly leveraged financial structure, S&P said.

“We expect INEOS to face very challenging operating trends in 2009 and 2010, given weaker economies and the petrochemical downturn,” the credit analysts said.

The analysts also noted that INEOS would have to renegotiate with lenders in April to obtain a longer-term covenant framework.

INEOS’ ratings would come under pressure if those renegotiations failed or led to substantial increases in interest costs, they added.

For more on INEOS visit ICIS company intelligence
To discuss issues facing the chemical industry go to ICIS connect

By: Stefan Baumgarten
+1 713 525 2653

AddThis Social Bookmark Button

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly