MILAN, Sept 19 Rating agency Moody's Investors
Service cut Italian defence and aerospace group Finmeccanica
to 'junk,' saying the company was improving at a
slower-than-expected pace, and after extensive delays in planned
sales worth 1 billion euros ($1.35 billion).
The agency lowered Finmeccanica's credit rating to Ba1 from
Baa3, thus bringing it to non investment-grade.
"The downgrade incorporates our expectation of a slower pace
of improvement in Finmeccanica's overall operating performance
and credit profile," said Russell Solomon, Moody's Senior Vice
President and lead analyst for the company.
Fitch Ratings already cut Finmeccanica to junk in June.
Analysts have said rating downgrades to speculative-grade
could impact the ability of Finmeccanica, Italy's second-largest
private sector employer, to receive pre-payments from customers
and harm its competitiveness outside Italy.
Finmeccanica had wanted to sell a number of the company's
assets by the end of this year. But political wrangling has
slowed the sale of AnsaldoEnergia, AsaldoBreda and Ansaldo STS
Finmeccanica generates over half of its revenues from
defence markets including Italy, the US and Britain which are
facing uncertain budget outlooks.
Finmeccanica is targeting a net profit in 2013 after two
years in the red. It has been hit by a corruption probe relating
to a helicopter deal in India and has recently named a new