Ambac unlikely to announce deal Tuesday: source
NEW YORK (Reuters) - Bond insurer Ambac Financial Group Inc (ABK.N) is unlikely to announce a capital raising deal on Tuesday, a person briefed on the matter said.
The second largest U.S. bond insurer is looking to raise capital to maintain top credit ratings at its main unit. Talks on finding a solution are continuing, but will not likely be concluded on Tuesday, the person briefed on the matter said.
Both Moody's Investors Service and Standard & Poor's are considering stripping Ambac Assurance Corp, Ambac's main insurance unit, of its top ratings.
Moody's said last week that Ambac's capital levels meet minimum requirements for a top "triple-A" rating, but are below "target" levels by $2 billion. S&P said it views Ambac as about $400 million short of where it ought to be.
The Financial Times reported on Tuesday that Ambac was not planning to split up its bond insurance businesses. Many bond insurers are thinking about dividing up the relatively risky structured finance guarantee business from the safe municipal bond insurance business.
CNBC reported on Tuesday that Ambac was progressing toward a deal, but had not yet reached an agreement.
Paul Burke, head of fixed-income investor relations at Ambac, declined to discuss the timing of any possible deal, but repeated the company's earlier statements that it is actively working to raise capital.
(Reporting by Dan Wilchins, editing by Leslie Gevirtz and Carol Bishopric)
