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Moody’s also confirms Bayer’s investment grade rating | message

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FRANKFURT (Dow Jones) – According to Standard & Poor’s, the rating agency Moody’s has also confirmed the investment grade rating that is important for the Bayer Group. The credit rating remains at Baa1, Moody’s said. Bayer bonds are therefore still considered to be good investments on average. The agency raised its outlook with anticipated progress in deleveraging from negative to stable.

As justification, Moody’s stated that the settlement agreements concluded last week, especially with regard to the weed killer Roundup, had eliminated significant risks that would have been associated with a protracted litigation – both financially and with regard to damage to the company’s reputation. However, there remains a certain amount of uncertainty as to the future claims. Financially, this is difficult to estimate, Moody’s believes, but manageable within the Baa1 rating.

Moody’s expects adjusted gross debt to EBITDA to drop 3.5 times in the current year from more than 4 to 2021 and to 3 in 2022. This leaves Bayer with limited scope for leveraged purchases or below-average business performance in the current rating category.

Similarly, S&P had already changed its mind last week. There, Bayer’s rating level is one level below that of Moody’s.

Contact the author: olaf.ridder@wsj.com

DJG / rio / kla

(END) Dow Jones Newswires

June 29, 2020 07:26 ET (11:26 GMT)

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