S&P rates Coventry notes BBB

Standard & Poor's said it assigned its BBB senior unsecured debt rating to Coventry Health Care Inc.'s $300 million senior unsecured notes due August 2014.

Proceeds will be used to help finance its pending acquisition of Vista Healthplans for $685 million.

The rating reflects Coventry's very strong earnings and cash-flow profile, geographic diversity and strong liquidity, according to S&P.

Offsetting factors include the company's very modest near-term organic health plan growth, material level of intangibles relative to equity and its acquisition-oriented growth strategy, the agency said.

Debt leverage and interest coverage are expected to remain conservative for the ratings, S&P said.

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