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S&P upgrades Toshiba, keeps long-term ratings on CreditWatch positive

S&P Global Ratings raised Toshiba Corp.'s long-term corporate credit and senior unsecured debt ratings two notches to B from CCC+, citing "substantial improvement" in the financial health of the company, which returned to profit in fiscal 2017.

The rating agency said Toshiba's financial standing, which it expects to stabilize, could strengthen further if it sells its memory chip business.

"[W]e believe Toshiba's financial standing will likely improve significantly if it receives the large cash sum from the sale," said S&P, which also cited the company's progress in reducing debt and increasing shareholders' equity.

With that projection, S&P kept the long-term ratings on CreditWatch with positive implications. The debt watcher said it will assess Toshiba's progress in selling its memory unit.

"Currently, though, we do not expect Toshiba Memory Corp. to weigh on Toshiba's credit quality," it said.

S&P also upgraded Toshiba's short-term corporate credit and commercial paper program ratings to B from C, and removed them from CreditWatch with positive implications.

This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings, a separately managed division of S&P Global. Descriptions in this news article were not prepared by S&P Global Ratings. The original S&P Global Ratings documents referred to in this news brief can be found here.