France-Based Kerneos Corporate SAS Ratings Withdrawn On Acquisition By Imerys

Stocks and Financial Services Press Releases Thursday August 10, 2017 17:08
LONDON--10 Aug--S&P Global Ratings

LONDON (S&P Global Ratings) Aug. 10, 2017--S&P Global Ratings today said ithas raised its long-term corporate credit rating on France-based producer ofcalcium aluminate cements Kerneos Corporate SAS to 'BBB' from 'B+', andremoved the rating from CreditWatch with positive implications where it wasplaced on Dec. 15, 2016.

We then withdrew the rating at the issuer's request. The outlook was stable atthe time of the withdrawal.

At the same time, we withdrew our issue and recovery ratings on the group's€200 million 5.75% senior secured fixed-rate notes and €175 millionfloating-rate notes due 2021, because these notes have been repaid.

The upgrade follows the closing of the acquisition of Kerneos by mineralspecialties producer Imerys for €880 million from its previous private equityowner Astorg Partners SAS. We understand that Kerneos has been fullyoperationally merged with its new parent, and has been financiallyconsolidated in Imerys' accounts since July 18, 2017. We therefore see Kerneosas a core subsidiary of Imerys.

Following the acquisition, the €200 million and €175 million notes issued byKerneos were repaid, and we understand that in future all new financing willbe drawn at the Imerys level.

Our rating on Imerys reflects our view that the group's operationalperformance benefits from significant diversification and vertical integrationinto mining. This provides profitability resilience despite cyclicalend-market exposure. Moderate leverage and strong recurring free cash flowssupport the company's intermediate financial risk profile, although we expectthat the debt-funded acquisition of Kerneos will lead to a slightdeterioration in Imerys' metrics for 2017. Imerys' comfortable and predictablefree cash flows should help steer credit metrics at levels we view ascommensurate with the rating over the medium term. We forecast adjusted debtto EBITDA of about 2.5x and adjusted funds from operations to debt of around30%. For more details, see "Mineral Specialties Producer Imerys AcquiresKerneos; Group Assigned 'BBB' Rating; Outlook Stable," published on Dec. 14,2016 on RatingsDirect.

Latest Press Release

StockChain Lands in the Heart of Global Finance, at New York#s Iconic Times Square

Stockchain (SCC), the world's first decentralized professional digital currency quotation and exchange platform, launched a new advertising campaign in the heart of the global financial sector, at New York's Times Square on March 15, 2018. The campaign,...

KTC launches HungryWhat to Eat? campaign and provides members the option to choose and dine deliciously with up to 30% discount.

"KTC" or Krungthai Card Public Company Limited, by Mrs. Pranaya Nithananon, Vice President - Credit Card Business, launches "Hungry…What to Eat?" campaign to respond to members' needs by providing various options at renowned restaurants, including...

GEM Report Shows Most Entrepreneurs Start Businesses Out of Opportunity Not Necessity

The 2017/18 Global Entrepreneurship Monitor (GEM) reports that that entrepreneurship levels remain stable around the world and opportunity-driven entrepreneurship predominates. A robust 74% of entrepreneurs around the world have started businesses in...

Qatar asks U.S. to investigate UAE bank for financial warfare

Qatar has asked U.S. regulators to investigate the U.S. subsidiary of the largest bank in the United Arab Emirates, accusing it of "bogus" foreign exchange deals designed to harm its economy as part of a blockade by Gulf neighbors. The Central Bank of...

IMF Staff Completes a Staff Visit to Cambodia

- Cambodia's near-term economic outlook remains positive with GDP growth at around 7 percent. - Policies should focus on managing macro-financial risks, safeguarding fiscal sustainability and advancing reforms to support growth, resilience and...

Related Topics