- Halliburton (NYSE:HAL) and Baker Hughes (BHI) are downgraded at Moody's, roughly a month after their planned merger fell apart due to U.S. and European antitrust concerns.
- Their senior unsecured credit ratings were dropped from A2 to Baa1, which reflects moderate credit risks and an uncertain business environment.
- Debt incurred to finance its failed bid to acquire Baker Hughes together with the negative impact on profitability and cash flow of the very weak oilfield services environment have eroded Halliburton’s credit metrics to levels which no longer support its A2 rating,” Moody’s writes on HAL.
- The failed deal also was cited in the BHI downgrade, as well as elevated leverage and developing business model.