The latest information on the rating, including rating reports and related methodologies, is available on this LINK.

Rating action

Scope Ratings GmbH (Scope) has placed the BBB- issuer rating of LANXESS AG under review for a possible upgrade. Scope has also placed the BBB- senior unsecured debt rating under review for a possible upgrade, while the S-2 short-term debt rating has been left unchanged.

The rating actions follow the publication of Scope’s updated Chemicals Rating Methodology on 30 June 2025^1,2. The updated methodology has introduced new elements to the assessment of a chemicals corporate’s business risk profile, which could have a positive effect on LANXESS' business risk profile and consequently its issuer and senior unsecured debt ratings.

The full list of rating actions and rated entities is at the end of this rating action release.

Key rating drivers

The application of the updated methodology could positively affect LANXESS’ ratings, as it is deemed likely that its business risk assessment could improve, thereby supporting a higher issuer rating and senior unsecured debt rating (currently both at BBB-). In particular, a more positive assessment of the rated entity's business risk profile (currently at BBB-) could be driven by a more substantiated view on the company’s diversification and operating profitability. Considering these potential positive effects, both ratings have been placed under review for a possible upgrade.

The rating review will likely be resolved within the next three months, once Scope has received all the information necessary to do so.

The resolution of the under-review status will also take into account the correction of previous calculation errors which affect the calculation of credit metrics and its components. The errors relate to the computation of Scope-adjusted interest*, EBITDA and consequently funds from operations and free operating cash flow. Scope deems it likely that the correction of the errors will have a material impact on the rating construct for the issuer rating.

The S-2 short-term debt rating remains unaffected by the methodology update as there is substantial headroom to a potentially higher short-term debt rating.

All rating actions and rated entities

LANXESS AG

Issuer rating: BBB-/Under Review for a possible upgrade, under-review placement

Short-term debt rating: S-2, no action

Senior unsecured debt rating: BBB-/Under Review for a possible upgrade, under-review placement

*All credit metrics refer to Scope-adjusted figures.

1. Scope publishes final Chemicals Rating Methodology
2. Chemicals Rating Methodology

Stress testing & cash flow analysis
No stress testing was performed. Scope Ratings performed its standard cash flow forecasting for the company.

Methodology
The methodologies used for these Credit Ratings, (General Corporate Rating Methodology, 14 February 2025; Chemicals Rating Methodology, 30 June 2025), are available on https://scoperatings.com/governance-and-policies/rating-governance/methodologies.
Information on the meaning of each Credit Rating category, including definitions of default, recoveries, Outlooks and Under Review, can be viewed in ‘Rating Definitions – Credit Ratings, Ancillary and Other Services’, published on https://www.scoperatings.com/governance-and-policies/rating-governance/definitions-and-scales. Historical default rates of the entities rated by Scope Ratings can be viewed in the Credit Rating performance report at https://scoperatings.com/governance-and-policies/regulatory/eu-regulation. Also refer to the central platform (CEREP) of the European Securities and Markets Authority (ESMA): http://cerep.esma.europa.eu/cerep-web/statistics/defaults.xhtml. A comprehensive clarification of Scope Ratings’ definitions of default and Credit Rating notations can be found at https://www.scoperatings.com/governance-and-policies/rating-governance/definitions-and-scales. Guidance and information on how environmental, social or governance factors (ESG factors) are incorporated into the Credit Rating can be found in the respective sections of the methodologies or guidance documents provided on https://scoperatings.com/governance-and-policies/rating-governance/methodologies.

Solicitation, key sources and quality of information
The Rated Entity and/or its Related Third Parties participated in the Credit Rating process.
The following substantially material sources of information were used to prepare the Credit Ratings: public domain, the Rated Entity and Scope Ratings' internal sources.
Scope Ratings considers the quality of information available to Scope Ratings on the Rated Entity or instrument to be satisfactory. The information and data supporting these Credit Ratings originate from sources Scope Ratings considers to be reliable and accurate. Scope Ratings does not, however, independently verify the reliability and accuracy of the information and data.
Prior to the issuance of the Credit Rating action, the Rated Entity was given the opportunity to review the Credit Ratings and the principal grounds on which the Credit Ratings are based. Following that review, the Credit Ratings were not amended before being issued.

Regulatory disclosures
These Credit Ratings are issued by Scope Ratings GmbH, Lennéstraße 5, D-10785 Berlin, Tel +49 30 27891-0. The Credit Ratings are UK-endorsed.
Lead analyst: Sebastian Zank, Managing Director
Person responsible for approval of the Credit Ratings: Philipp Wass, Managing Director
The Credit Ratings/Outlook were first released by Scope Ratings on 30 January 2018. The Credit Ratings/Outlook were last updated on 19 February 2025.

Potential conflicts
See www.scoperatings.com under Governance & Policies/Regulatory for a list of potential conflicts of interest disclosures related to the issuance of Credit Ratings, as well as a list of Ancillary Services and certain non-Credit Rating Agency services provided to Rated Entities and/or Related Third Parties.

Conditions of use/exclusion of liability
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