(Repeat for additional subscribers)
April 29 (The following statement was released by the rating agency)
A potential new bidder for Alstom SA has led to
significantly tighter credit default swap (CDS) spreads in recent days,
according to Fitch Solutions in its latest CDS case study.
Five-year CDS on Alstom have come in 42% since this past Thursday, with credit
protection now trading in investment grade territory (in line with 'BBB-'
entities). CDS liquidity for Alstom has been falling steadily since March to the
38th regional percentile from the 20th.
'The CDS market seems to be reacting favorably to news that Siemens has reached
out to Alstom to discuss strategic opportunities, which would potentially put a
wrench in General Electric's bid for the French power and transport giant,' said
Director Diana Allmendinger.
Fitch Solutions case studies build on data from its CDS Pricing Service and
proprietary quantitative models, including CDS Implied Ratings. These credit
risk indicators are designed to provide real-time, market-based views of
creditworthiness. As such, they can and often do reflect more short term market
views on factors such as currencies, seasonal market effects and short-term
technical influences. This is in contrast to Fitch Ratings' Issuer Default
Ratings (IDRs), which are based on forward-looking fundamental credit analysis
over an extended period of time.
Additional information about Fitch Solutions' products is available in the link