Fitch shifts Faurecia view to negative

Fitch Ratings said it revised Faurecia SE's outlook to negative from stable and affirmed its long-term issuer default rating at BB+.

“The negative outlook reflects our revised expectation that, in the absence of disposals, Faurecia's funds from operations (FFO) net leverage will now remain above 2.5x to 2025, which corresponds to the BB rating median in our Rating Navigator and the negative rating sensitivity for Faurecia. This is despite the recent equity raise,” Fitch said in a press release.

Management expects around €1 billion in proceeds from its disposal program, which is larger than its initial €500 million plans.

“Fitch believes that applying proceeds from successful disposals to gross debt reduction could ease leverage metric to levels that are commensurate with a BB+ rating. On the other hand, FFO net leverage above 2.5x beyond 2023 will result in a downgrade,” the agency said.

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