Why weren t the asbestosrelated claims disclosed in the prospectus of the Swedish engineer s IPO? Whether or not the claims are material, the company's credibility has suffered. If they are, the underwriters may be at risk.
But the struggling engineering group may find knights in shining armour: Credit Suisse, Barclays and Citigroup. Shareholders would be mad to put in equity, lenders barmy to extend new credit.
The SwissSwedish engineer is at the mercy of its banks. But they may help out. However, the banks may demand security over ABB's assets. That's not great news for bondholders.