-AM Best starts "negative" review on Highmark.
BANKING AND CREDIT NEWS-November 3, 2011--AM Best starts "negative" review on Highmark(C)2011 M2 COMMUNICATIONS http://www.m2.com
3 November 2011 - AM Best on Wednesday placed under review with "negative" implications the financial strength ratings (FSRs), issuer credit ratings (ICRs) and debt ratings of US insurer Highmark and its subsidiaries.
The rating actions come after Highmark announced a definitive agreement with West Penn Allegheny Health System (WPAHS) over an affiliation between the two organisations.
The new status of the ratings reflects the rating agency's concerns over the affiliation. AM Best is worried about WPAHS's integration and financial viability as well as its big outstanding debt and troubled financial history.
The under review status will remain in place until AM Best meets Highmark's management to discuss the affiliation and after the transaction, which needs to be approved by regulators, is completed, which is expected to take place in 2012.
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