S&P puts ITT on watch

S&P said it placed its BB issuer rating on ITT Holdings LLC on CreditWatch with negative implications after its parent reported plans to sell the company for about $2.69 billion to an affiliate of Riverside Holdings LLC. S&P also placed ITT’s senior unsecured rating on watch.

“Pro forma for the transaction, IMTT's financial policy will be determined by Riverstone, which we consider a financial sponsor. We think financial sponsors are more likely to use leverage to fund transactions and, more generally, increase financial returns. As a result, ratings are generally lower for financial sponsor owned-companies in comparison to strategically owned companies,” S&P said in a press release.

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