Procter & Gamble Co, the largest US household-goods maker with products ranging from Crest toothpaste to Pampers disposable diapers, had its credit rating cut for the first time since 1991.
Moody's Investors Service on Friday cut Procter & Gamble's long-term rating to "Aa3," the fourth of 10 investment-grade levels, from "Aa2." Recent acquisitions made by Procter & Gamble may hurt the company's ability to meet its debt obligations, Moody's said.
About US$12.4 billion of Procter & Gamble debt is affected by the downgrade, the ratings company said. Moody's didn't change Procter & Gamble's "P-1" short-term rating.
"I don't think it changes the prospect for Procter & Gamble," said Dan Popowics, an equity analyst at Fifth Third Bank, which owns Procter & Gamble shares. "I don't think it has major implications for their stock price or their business."
Standard & Poor's has rated Procter & Gamble's debt "AA" since April 1991, when it downgraded the credit from "AA+." S&P is reviewing the rating for a possible downgrade.
Procter & Gamble has US$9.6 billion of bonds outstanding, almost half of which come due between 2003 and 2006, according to Bloomberg data.
"This isn't unexpected," said Linda Ulrey, a Procter & Gamble spokeswoman. "We anticipated this was a likely occurrence as a result of our plans to acquire Clairol."
Procter & Gamble agreed to buy Bristol-Myers Squibb Co's Clairol unit in May to begin selling hair coloring, sales of which are growing twice as fast as those of household products.
Shares of Cincinnati-based Procter & Gamble, down 8.5 percent this year, rose US$1.45, or 2.1 percent, to US$71.75. The company's 6 7/8 coupon bonds due in 2009 dropped US$2.70 per US$1,000 face value to US$1,092.10.
LONG FLIGHT: The jets would be flown by US pilots, with Taiwanese copilots in the two-seat F-16D variant to help familiarize them with the aircraft, the source said The US is expected to fly 10 Lockheed Martin F-16C/D Block 70/72 jets to Taiwan over the coming months to fulfill a long-awaited order of 66 aircraft, a defense official said yesterday. Word that the first batch of the jets would be delivered soon was welcome news to Taiwan, which has become concerned about delays in the delivery of US arms amid rising military tensions with China. Speaking on condition of anonymity, the official said the initial tranche of the nation’s F-16s are rolling off assembly lines in the US and would be flown under their own power to Taiwan by way
OBJECTS AT SEA: Satellites with synthetic-aperture radar could aid in the detection of small Chinese boats attempting to illegally enter Taiwan, the space agency head said Taiwan aims to send the nation’s first low Earth orbit (LEO) satellite into space in 2027, while the first Formosat-8 and Formosat-9 spacecraft are to be launched in October and 2028 respectively, the National Science and Technology Council said yesterday. The council laid out its space development plan in a report reviewed by members of the legislature’s Education and Culture Committee. Six LEO satellites would be produced in the initial phase, with the first one, the B5G-1A, scheduled to be launched in 2027, the council said in the report. Regarding the second satellite, the B5G-1B, the government plans to work with private contractors
‘NARWHAL’: The indigenous submarine completed its harbor acceptance test recently and is now under heavy guard as it undergoes tests in open waters, a source said The Hai Kun (海鯤), the nation’s first indigenous defense submarine, yesterday began sea trials, sailing out of the Port of Kaohsiung, a military source said. Also known as the “Narwhal,” the vessel departed from CSBC Corp, Taiwan’s (台灣國際造船) shipyard at about 8am, where it had been docked. More than 10 technicians and military personnel were on deck, with several others standing atop the sail. After recently completing its harbor acceptance test, the vessel has started a series of sea-based trials, including tests of its propulsion and navigational systems, while partially surfaced, the source said. The Hai Kun underwent tests in the port from
MISSION: The Indo-Pacific region is ‘the priority theater,’ where the task of deterrence extends across the entire region, including Taiwan, the US Pacific Fleet commander said The US Navy’s “mission of deterrence” in the Indo-Pacific theater applies to Taiwan, Pacific Fleet Commander Admiral Stephen Koehler told the South China Sea Conference on Tuesday. The conference, organized by the Center for Strategic and International Studies (CSIS), is an international platform for senior officials and experts from countries with security interests in the region. “The Pacific Fleet’s mission is to deter aggression across the Western Pacific, together with our allies and partners, and to prevail in combat if necessary, Koehler said in the event’s keynote speech. “That mission of deterrence applies regionwide — including the South China Sea and Taiwan,” he
RSS