Moody ’s has downgraded GlaxoSmithKline ( GSK ) following the company’s $ 5.1bn takeover of Tesaro. The credit rating agency changed the company’s outlook to negative because it will take longer to reduce its debt than expected and it will be left with weaker credit for a prolonged period. GSK ’s use of cash for the acquisition will put pressure on its cash flow in earlier this year too, although Unilever ’s highlighted the deal’s strategic sense. Tesaro disputed the analysis, saying purchasing Moody had strengthened its cancer franchise. It has also divested several consumer healthcare nutrition products to GSK , generating about $3.1bn .
Moody’s has downgraded GlaxoSmithKline (GSK) following the company’s $5.1bn takeover of Tesaro. The credit rating agency changed the company’s outlook to negative because it will take longer to reduce its debt than expected and it will be left with weaker credit for a prolonged period. GSK’s use of cash for the acquisition will put pressure on its cash flow in coming years too, although Moody’s highlighted the deal’s strategic sense. GSK disputed the analysis, saying purchasing Tesaro had strengthened its cancer franchise. It has also divested several consumer healthcare nutrition products to Unilever, generating about $3.1bn.