U.S.-based Whirlpool Corp. announced it has entered into an agreement with Emerson Electro Co. to acquire InSinkErator for $3 billion. We view the proposed acquisition of the world's largest manufacturer of food waste disposers as a good strategic fit. However, Whirlpool's pro forma adjusted leverage will rise considerably to 3x as demand for its large appliances weakens and economic risks increase. We affirmed all our ratings on Whirlpool, including our 'BBB' long-term and 'A-2' short-term issuer credit ratings, and revised our outlook to negative from stable. Our negative outlook reflects the potential for a lower rating over the next 24 months if difficult economic conditions weaken credit metrics, including adjusted leverage sustained at or above 3.5x. Whirlpool has indicated it
