Fitch Ratings says statements by MGIC Investment Corp., Milwaukee, regarding C-BASS and MGIC's merger with Philadelphia-based Radian Group have made the probability that the merger will be consummated "lower than previously expected."Back on July 31, when both companies admitted they would have to take an impairment on Credit-Based Asset Servicing and Securitization LLC, a New York-based specialty servicer, Fitch put Radian on Rating Watch Negative. It said the move reflected Radian's "relatively weakened stand-alone financial position as a result of C-BASS." Fitch added that if the merger didn't occur, Radian's ratings would be downgraded by one notch. MGIC's announcements have increased the likelihood that this will happen. On the other hand, Fitch said MGIC is still in "a good position to operate at its current rating level, either combined with Radian or as a stand-alone company." Fitch can be found online at http://www.fitchratings.com.
Fitch: MGIC/Radian Merger Less Likely
AUG 9, 2007 2:00pm ET