15 July 2011 14:25 [Source: ICIS news]
LONDON (ICIS)--Moody’s has upgraded its rating on INEOS debt following the successful closing of the refinery and oil products trading joint venture deal with state-owned PetroChina, the debt rating agency said on Friday.
It expects accelerated deleveraging given the $1bn (€710m) proceeds from the deal and current strong cash flow generation. However, Moody's warns that there is little scope in the near-term for incremental improvement in Switzerland-headquartered INEOS’s operating performance.
“We expect the leverage to reduce towards 4.5 times on the fully adjusted basis,” Moody’s said in a statement.
“Strong operating performance in 1H [the first half of] 2011 and the likely supportive supply/demand fundamentals for the main co-monomers should continue to support to the deleveraging efforts,” it added.
However, Moody's said: “We see limited potential for the incremental improvement in the operating performance in the near term, given the current high level of pricing and high utilisation rates enjoyed by INEOS.”
A positive outlook has been put on the debt profile in the expectation that management will work to reduce the company’s interest burden over time.
($1 = €0.71)
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