Rubber chemicals company Flexsys Inc. is experiencing weaker volumes and its credit measures are worse than we anticipated. Although the company has completed the separation from Eastman Chemical Co. and set up its enterprise resource planning system, Flexsys is facing headwinds pertaining to an uneven reopening of the Chinese economy, competitive pressure in Asia, and tepid replacement tire demand. We revised our rating outlook on Flexys to negative from stable and affirmed the ratings on the company, including the 'B' foreign and local issuer credit ratings. The negative outlook reflects the one-in-three risk of a downgrade if it appears evident that Flexsys's credit measures will weaken to levels inappropriate for the ratings; for example, a weighted average adjusted debt to
