S&P lowers Baxter outlook but maintains ratings

Posted May 6, 2010 at 11:07 a.m.

Associated Press | Standard & Poor’s Ratings Services reduced
its outlook on Baxter International Inc. Thursday, but said Baxter’s
diverse range of products will help it deal with a recall of its drug
infusion pumps.

Standard & Poor’s said its view of Baxter’s credit is “Stable,” down
from a previous “Positive” outlook. The firm maintained its
investment-grade “A+” corporate credit rating on the company.

Despite the recall and the hefty charge Baxter will take, Standard &
Poor’s said the company offers a broad range of medical products and
has a very large customer base.

The Deerfield, Ill., company said Monday that regulators ordered it to
pull up all of its Colleague pumps off the market because of problems
that have not been corrected. The Food and Drug Administration estimates
that there are about 200,000 Colleague pumps being used in the U.S.,
and Baxter will have to give customers other products.

Baxter will book a one-time pretax charge of $400 million to $600
million in the first quarter because of the directive. Its shares fell
5.1 percent Tuesday, but have recovered some of that loss. The stock
rose 34 cents to $45.99 in Thursday morning trading.

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