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Asbestos Claims Cast Cloud on ABB, But Legal Deal Offers Hope of Silver Lining Dec 02
Standard & Poors, Dec 2002
Abstract
Switzerland-based engineering group ABB Ltd. (BBB-/Watch Neg/A-3) currently faces the double problem of excessive financial leverage and asbestos-related lawsuits in the U.S. On Oct. 21, 2002, ABB also announced that the group would not meet its profit target for financial year 2002 and revised its medium-term outlook downward. As a result, Standard & Poor's lowered long-term corporate credit ratings on the group in two steps: to 'BBB+' from 'A-'on October 22, and then to 'BBB-' on November 5. In addition, the ratings on the group were put on CreditWatch with negative implications. The resolution of the CreditWatch placement is pending completion of a full credit review, which is expected to be finalized by mid-January 2003. During recent weeks, ABB has...
Companies mentioned in this report are: ABB Ltd.
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Commentary
Criteria articles describe the thought process and methodology Standard & Poor's analysts use in determining ratings. These commentary pieces discuss both the quantitative (economic and financial) and qualitative (business analysis and caliber of management) aspects of the analysis, as well as legal issues.
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