Reuters writer P.J. Huffstutter reported yesterday that, “Fitch Ratings on Wednesday became the second major ratings agency to put Syngenta AG on notice for a potential downgrade, over uncertainties surrounding the Swiss-based company’s genetically modified corn lawsuit liabilities.
“Fitch said it has put the world’s largest crop chemical company on ‘rating watch negative,’ flagging concerns about how Syngenta will pay to settle the lawsuits and whether the Chinese government will support litigation liabilities. Fitch rates Syngenta at BBB, two notches above junk.
“‘While the amount of the settlement is currently unknown, it may threaten the pace of the company’s future deleveraging absent a financial intervention by ChemChina,’ Fitch said in a statement.”
The Reuters article added that, “Syngenta officials could not be immediately reached for comment.
“The company’s low investment-grade rating, linked in part to its expected ability to reduce leverage as well as ChemChina providing financial support, is not consistent with its financial profile, Fitch said. Syngenta has agreed to be acquired by ChemChina for $44 billion.”
