Johnson Controls (NYSE: JCI) today announced that Adient, the automotive seating and interiors business that it plans to spin off in October, has received a BB+ preliminary corporate credit rating and a BBB senior secured credit rating from S&P Global Ratings (S&P).
“These ratings are in line with our expectation to have high non-investment-grade debt ratings when we list on the New York Stock Exchange in October,” said incoming Adient Chairman and Chief Executive Officer R. Bruce McDonald. “We expect Adient’s leading market position, anticipated earnings growth, and consistent ability to generate cash will enable the company to quickly de-lever its balance sheet and transition to an investment grade company.”
With $20 billion in consolidated annual revenues in fiscal year 2015, Adient will be the global leader in the $60 billion market for automotive seating.
Mr. McDonald added, “The S&P ratings put us one step closer to having both tradeable debt and equity. The ratings also show that Adient will continue to be a solid and reliable business partner to our customers and vendors after our separation from Johnson Controls.”
Completion of Adient’s spin-off from Johnson Controls is subject to a number of conditions, including, among others, effectiveness of the Form 10 and other customary conditions. The spin-off remains subject to final approval of the Johnson Controls board of directors.
