OREANDA-NEWS. S&P Global Ratings said today that it has placed all of its ratings on Raleigh, N. C.-based Sensus U. S.A. Inc., including our 'B' corporate credit rating, on CreditWatch with positive implications.

"Xylem Inc. announced today that it intends to acquire Sensus U. S.A. Inc. for $1.7 billion," said S&P Global credit analyst James Siahaan. "The CreditWatch positive placement reflects the potential that we could upgrade Sensus to equalize our ratings on the company with our ratings on Xylem Inc. before we withdraw them." Sensus is a global manufacturer of smart meters and associated infrastructure that generated $870 million of revenue and $181 million of adjusted EBITDA during the trailing 12 months ended June 30, 2016.

We intend to resolve the CreditWatch placement on Sensus in the next 90 days after we conduct our review. Our review will focus on the combined company's expected operating performance, growth strategies, and proposed capital structure, as well as the likelihood that the deal will receive regulatory approval and any other potential impediments that may prevent the completion of the transaction.

We could potentially equalize our rating on Sensus with those on Xylem because Sensus will likely become a core subsidiary of Xylem given its meaningful contribution to the combined company's sales and operations. When the transaction closes, which we expect will occur at the end of 2016, we will likely withdraw our ratings on Sensus if its debt has been repaid.