Fitch Solutions: Anadarko's CDS Tighten to Seven-Year Low on Takeover Talk
NEW YORK--(BUSINESS WIRE)--Takeover speculation has helped credit default swap (CDS) spreads on Anadarko Petroleum Corporation tighten to levels not seen since 2007, according to the latest CDS case study from Fitch Solutions.
Five-year CDS on Anadarko Petroleum Corporation have tightened 29% over the past month and are 64% tighter since the start of this year. Anadarko's CDS liquidity has increased over the past three trading days, with contracts now trading in the 14th regional percentile.
'Improved market sentiment for Anadarko of late is likely attributable to speculation that the company may be taken over by ExxonMobil,' said Director Diana Allmendinger. 'Also contributing to Anadarko's spread tightening earlier this year was a litigation settlement that had been hanging over the company for a long time.'
Fitch Solutions case studies build on data from its CDS Pricing Service and proprietary quantitative models, including CDS Implied Ratings. These credit risk indicators are designed to provide real-time, market-based views of creditworthiness. As such, they can and often do reflect more short term market views on factors such as currencies, seasonal market effects and short-term technical influences. This is in contrast to Fitch Ratings' Issuer Default Ratings (IDRs), which are based on forward-looking fundamental credit analysis over an extended period of time.
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