RATING
Moody’s guns for state entities and big business
The ratings agency targets major South African industrial players in its slew of downgrades
Large industrial stocks were among a slew of South African companies hit by Moody’s credit rating downgrades on Wednesday, including banks, miners and telecoms counter MTN. The ratings agency also downgraded municipalities and state-owned companies as a result of "constraints" in the economy brought about by SA’s recent sovereign downgrades. Mark Hodgson, an analyst at Avior Capital Markets, said there were contrasting global rating actions in respect of Bidvest and Barloworld. The former was downgraded with a negative outlook, while Barloworld was upgraded with a stable outlook. "With Bidvest potentially looking to internationalise its services and commercial products divisions this may have implications for the cost of offshore debt," Hodgson said. Moody’s said Wednesday’s rating actions followed the weakening of the South African government’s credit profile. Downgrades included Transnet, Eskom, Ekurhuleni metro municipality, Imperial Group and Redefine Properties. But Moody’s aff...
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