The ratings on France-based specialty and intermediate water treatment chemical producer SPCM S.A. reflect the group's aggressive leverage following major investments in new production facilities and a significant share buyback tied to a minority shareholder payout. The ratings also take into account the group's overall relatively small size and somewhat limited product diversification. SPCM owns 100% of the SNF group, comprising SNF S.A., SNF Holding Co. (USA), and sister companies. The group is focused on the production of polyacrylamide products used mainly for wastewater treatment (for municipalities and for paper, mining, and other industries). SNF is the market leader, but the industry is highly competitive, partially explaining recent margin erosion. SNF competes against: larger, more diversified chemical producers like Ciba
