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S&P revises outlook on Range Parent to negative

S&P Global Ratings revised its outlook on Range Parent Inc. to negative from stable, as the Illinois-based company remained weak in credit measures.

The rating agency noted that Range Parent's indirect operating subsidiary, Robertshaw Controls Co., is experiencing soft demand amid a manufacturing slowdown, a sluggish domestic housing market, a weak European environment and international trade tensions. It said Robertshaw's operating performance might not be strong enough in the next year to improve Range Parent's credit measures to levels fit for the current ratings.

Robertshaw is expected to achieve and maintain an adjusted debt-to-EBITDA ratio of less than 7x at the current ratings. This ratio was 10x as of March 31, its fiscal year-end, and 8.6x as of the first quarter ended June 30. Ratings also cited the company's issuance of a €60 million unrated term loan in December 2018 to fund its purchase of Italy-based CastFutura SpA, which increased its debt.

Ratings said the negative outlook reflects the 1-in-3 potential for lower ratings in the next year if Robertshaw's performance and financial policies prevent it from achieving and maintaining an adjusted debt-to-EBITDA ratio of less than 7.0x.

Ratings affirmed all of its ratings on Range Parent, including its B issuer credit rating.

This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings. Descriptions in this news article were not prepared by S&P Global Ratings.