S&P may cut CGG-Veritas

Standard and Poor's said it placed its BB- long-term corporate credit and issue ratings on Compagnie Generale de Geophysique - Veritas (CCG-Veritas) on CreditWatch with negative implications.

The CreditWatch placement follows the company's announcement that it will acquire the geoscience division of Fugro NV.

S&P said the CreditWatch reflects its view that the €1.2 billion acquisition, funded by a bridge loan and proceeds from shares in the newly created Seabed joint venture, will increase the company's gross debt from an already sizable $1.9 billion at the end of June 2012.

As a result, the agency estimates that credit metrics for 2012 and 2013 will fall short of its previous forecasts of S&P-adjusted debt to EBITDA of less than 4x and funds from operations to debt of more than 20%.

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