Fitch affirms Invesco's credit as good quality

Last Updated: Fri, Oct 23, 2009 19:31 hrs

Fitch Ratings on Tuesday affirmed its debt ratings on Invesco Ltd. after the investment manager announced Monday that it would buy Morgan Stanley's retail asset management unit.

Fitch affirmed Invesco's long-term issuer default rating as BBB+. That implies good credit quality with low default risk. Fitch also said it has a stable outlook and other categories of debt were also of good quality.

"The affirmation reflects Invesco's good financial performance and extensive franchise, and Fitch believes both of these strengths should be enhanced after the acquisition," Fitch said in a statement.

Atlanta-based Invesco said Monday it would buy the Morgan Stanley unit that includes the Van Kampen funds, which are run out of Houston. Fitch said the deal includes about $119 million in assets under management. The addition of those assets will boost Invesco's assets under management by 29 percent.

The $1.5 billion cash-and-stock acquisition would result in one-time costs of $100 million to $125 million, Fitch said.

Invesco shares rose 29 cents to $23.41 in afternoon trading.

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