Duff & Phelps Credit Rating Co. and Fitch IBCA have completed their merger, creating a single rating agency that will operate under the name Fitch. The merger, announced in March, closed in early June. Fitch IBCA, a subsidiary of Fimalac SA, a diversified French operating company, acquired Duff & Phelps for $100 per share, cash, for a total of $528 million. Headquartered in both New York and London with a major office in Chicago, Fitch rates entities in 75 countries and has some 1,100 employees in more than 40 offices worldwide. Fitch rates 1,600 financial institutions and over 800 corporates, maintains surveillance on 3,300 structured financings and 17,000 municipal bonds ratings in the U.S. tax-exempt market. It also rates more than 700 insurance companies and 67 sovereigns. All outstanding ratings from the two agencies are being combined into a single set that, with a couple of exceptions, will follow the Fitch IBCA rating definitions. As a result, the new Fitch will no longer issue a short-term credit rating of D1- as previously issued by Duff & Phelps. All current D1- ratings of Duff & Phelps will be changed to an appropriate rating by Fitch based on the ratings definitions it has adopted. One feature of the Duff & Phelps rating scale that will be retained by Fitch is the use of Rating Watch instead of the Fitch IBCA designation RatingAlert, which is used to notify investors and issuers of a reasonable probability of a rating change and the likely direction of that change. Fitch will use the qualifiers "positive" to mean a rating may be upgraded, "negative" that it may be downgraded, or "evolving." to indicate a rating may be changed in some way upon further research. In addition, Fitch will retain the use of "Rating Outlooks," introduced by Duff & Phelps last year. Rating Outlooks will be assigned to all the sectors that the agency rates, excluding structured finance transactions. Other leading credit ratings services are Standard & Poor's and Moody's Investors Service. -Jodi Wetuski
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