S&P: French Rail Manufacturer Alstom 'BBB-/A-3' Ratings Affirmed, Then Withdrawn At The Company's Request
At the time of the ratings withdrawal, our assessment of Alstom's business risk profile factored in the company's strong market position as the third-largest global rail manufacturer. We also took into account Alstom's extensive integrated capabilities, track record of successful project execution, and strong geographic diversity. Moderating our view of Alstom's business risk profile were its relatively low diversification and profitability compared with major capital goods players.
Our assessment of the company's financial risk profile was supported by our expectations of continuous deleveraging following the completion of Alstom's €12.35 billion divestment of its energy businesses, with part of the proceeds allocated to an exceptional share buyback of €3.2 billion. We expected Alstom to maintain a conservative balance sheet, notwithstanding any acquisitions, at least in line with management's target of reported net debt close to zero.
At the time of the withdrawal, the outlook was stable; this indicated our expectation that the company would achieve its operating performance targets, continue its track record of successful project execution, and importantly, progressively repay upcoming bond maturities and deleverage in line with our projections.