Linde CEO banks on investment-grade rating

FRANKFURT (Reuters) - German industrial gases company Linde (LING.DE: Quote, Profile, Research, Stock Buzz) said Moody's Investors Service and Standard & Poor's had signaled that it would retain its investment grade rating following its acquisition of BOC BOC.L.

"They have already given us comfort that we will stay investment grade," Linde Chief Executive Wolfgang Reitzle said at the Reuters Chemical Summit, referring to S&P. He said Moody's had signaled the same.

Reitzle added that an investment grade rating was a prerequisite for the deal.

"The basic principle in financing and planning the acquisition was that we must stay investment grade. Without an investment grade rating we would not go forward."

"It is clear that we will be downgraded from where we are today, but for us it is most important that we are not downgraded to below investment grade," Reitzle said.

Linde is currently rated BBB+ by Standard & Poor's and A3 by Moody's Investors Service, respectively the third- and fourth-lowest rungs of investment grade.

Reitzle reiterated that there were no plans to redeem Linde's existing hybrid bond, which has a lower credit rating.

S&P rates the bond at BBB-, the very bottom of investment grade. If Linde's ratings are cut as a result of the BOC acquisition, the bond could be downgraded to "junk".