Moody’s ups Danaher view to stable

Moody's Investors Service said it affirmed Danaher Corp.’s A2 senior unsecured and Prime-1 short-term and changed the outlook to stable from negative.

Moody’s said the action reflects the progress that Danaher has made in restoring its balance sheet following the incurrence in 2015 of more than $11 billion of debt to fund the acquisition of Pall Corp. The agency expects that Danaher will have retired upwards of $8 billion of debt by the end of 2016, reducing funded debt to about $7.5 billion and debt to EBITDA to about 2.3 times.

The change in outlook also reflects Moody's expectation that ongoing application of the Danaher Business System across its businesses that remain following the Fortive Corp. (Baa1, stable) spin-off, which was completed on July 2, will expand earnings and sustain the company's strong free cash flow profile for years to come.

The company received a $3 billion dividend from Fortive when the spin-off was completed. A majority of these funds will be applied to debt retirements by the end of 2016.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.