Moody's has upgraded the Insurance Financial Strength Rating of SCOR and various subsidiaries to A3 from Baa1, SCOR's senior debt to A3 from Baa1, and SCOR's subordinated debt to Baa2 from Baa3. All ratings have a stable outlook.
The rating action reflects the continued enhancement of SCOR's financial profile, with further improvements, for example, in return on equity, financial leverage and the profitability of the group's life operation, together with the proposed acquisition of the life reinsurer, Revios. In July 2006, SCOR announced that it had agreed with GLOBALE to acquire Revios for €605m, with the reimbursement of Revios' €50m outstanding subordinated debt increasing the total consideration to €655m.
Dominic Simpson, vice president and senior credit officer, and lead analyst for SCOR at Moody's, said: "On a combined basis, SCOR and Revios would likely become a top five player in the global life reinsurance market, with a particularly strong position in Europe. Notwithstanding the inherent uncertainties and execution risks associated with such a transaction, and in light, inter alia, of the very complementary geographical positions of SCOR Vie and Revios within Europe, we believe that integration risk is relatively limited and predominantly confined to US operations, IT systems and quarterly reporting."
