Bulletin: Daimler's Truck And Bus Spin-Off Is Credit Positive

FRANKFURT (S&P Global Ratings) Feb. 5, 2021--S&P Global Ratings today said that global car and truck maker Daimler AG's (BBB+/Stable/A-2) planned spin-off of its truck and bus business is overall credit positive. We think the transaction could incrementally improve profitability and, with a time lag, cash conversion of the remaining group (which will be re-named Mercedes-Benz), without materially diluting our view of Daimler's business. We also believe the separation could facilitate a better execution of Daimler's strategy for its premium car segment, because the two businesses continue to diverge in terms of powertrain, driver assistance, and other digital technology. Daimler announced it would retain a minority stake in the truck business, which we expect would either generate receipts from dividend

...February 5, 2021 FRANKFURT (S&P Global Ratings) Feb. 5, 2021--S&P Global Ratings today said that global car and truck maker Daimler AG's (###+/Stable/A-2) planned spin-off of its truck and bus business is overall credit positive. We think the transaction could incrementally improve profitability and, with a time lag, cash conversion of the remaining group (which will be re-named Mercedes-Benz), without materially diluting our view of Daimler's business. We also believe the separation could facilitate a better execution of Daimler's strategy for its premium car segment, because the two businesses continue to diverge in terms of powertrain, driver assistance, and other digital technology. Daimler announced it would retain a minority stake in the truck business, which we expect would either generate receipts from dividend payments--or sales proceeds if Daimler makes a full exit in the medium term. However, the spin-off reduces Daimler's diversification, and this somewhat offsets the aforementioned...

Bulletin