(September 13 – 16:30 ET) –
Damned if you do and damned if you
don’t seems to be the situation
facing executives at Burlington,
Ont.-based transportation and
environmental giant Laidlaw Inc.
Moody’s Investors Service
today confirming its Baa3 rating on
Laidlaw’s senior debt, but is also
maintaining its negative outlook
on the company. The statement
followed Laidlaw’s announcement
that it will sell its U.S. health
care operations and its investment
in Safety-Kleen Corp.
Moody’s says it lowered
Laidlaw’s rating from Baa2 in
February 1998 due to the company’s
increased involvement with the
non-core health care business.
It says that getting out of that
business may cut Laidlaw’s risk in
the short term, but it remains
concerned the company may not be
able to maximize its value from
the sale since the industry is
facing hard times. It also says
Laidlaw has limited financial
flexibility to alter its
strategy.
The gains from the sale of the
businesses are slated for debt
reduction, but Moody’s says it
remains cautious that the funds
may go to finance other
acquisitions in the core busing
business.
IE Staff
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