Bulletin: CIMIC Group's Selldown Of Thiess To Reduce Business Diversity, Supports Deleveraging

MELBOURNE (S&P Global Ratings) Aug. 5, 2020--S&P Global Ratings today said that CIMIC Group Ltd.'s (BBB/Stable/A-2) proposed 50% divestment of its global mining services subsidiary Thiess to Elliott Advisors would reduce business scale and diversity, as well as cash flow, at the CIMIC level. The divestment will have a similar effect, though at a lower scale, at the parent ACS, Actividades de Construccion y Servicios SA group level. At this stage, our ratings on parent ACS, CIMIC Group, and the group's other core subsidiaries--Hochtief AG and ACS Servicios Comunicaciones y Energia S.L.--remain unchanged. Moreover, a corresponding decrease in financial risk or recycling of capital into new cash-generating assets could offset a reduced share of Thiess' cash generation. We will assess

...August 4, 2020 MELBOURNE (S&P Global Ratings) Aug. 5, 2020--S&P Global Ratings today said that CIMIC Group Ltd.'s (###/Stable/A-2) proposed 50% divestment of its global mining services subsidiary Thiess to Elliott Advisors would reduce business scale and diversity, as well as cash flow, at the CIMIC level. The divestment will have a similar effect, though at a lower scale, at the parent ACS, Actividades de Construccion y Servicios SA group level. At this stage, our ratings on parent ACS, CIMIC Group, and the group's other core subsidiaries--Hochtief AG and ACS Servicios Comunicaciones y Energia S.L.--remain unchanged. Moreover, a corresponding decrease in financial risk or recycling of capital into new cash-generating assets could offset a reduced share of Thiess' cash generation. We will assess the rating implications when the terms of the transaction are finalized. Key transaction details that are yet to be announced include: the structure of the transaction; use of proceeds; terms of...

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