Standard and Poor's Corp said debtratings on 840 mln dlrs of debt of Baker International Corp and
Hughes Tool Co remain on creditwatch.
    S and P cited the adjournment of a special shareholder
meeting in which Hughes objected to certain conditions for the
merger of the companies set by the U.S. Justice Department.
    If the merger is consumated, S and P would rate the newly
formed Baker Hughes Inc senior debt at A-minus, subordinated
debt at BBB-plus and commercial paper at A-2. But if the merger
does not occur, Baker's senior debt would be cut to A-minus
from A and commercial paper to A-2 from A-1.
    Without the merger, Hughes Tool's current ratings of B-plus
for senior debt, B-minus for subordinated debt and C for
commercial paper would be affirmed, S and P said.
    That would reflect the continuation of dismal industry
conditions and the company's substantially weaker credit
profile, S and P explained.
 Reuter
