Moody’s upgrades Olympus

Moody's Investors Service said it upgraded Olympus Corp.'s issuer and senior unsecured ratings to Baa1 from Baa2 and changed the outlook to stable from positive.

"The upgrade of Olympus's ratings is driven by the company's successful transition into a pure-play medical device company through divestments of its non-core businesses while achieving sales growth and margin improvement in its medical device business," said Ryohei Nishio, a Moody's assistant vice president and analyst, in a statement.

"The upgrade also reflects our expectation that Olympus' strong balance sheet including its sizable cash holdings will help it absorb acquisitions and maintain its credit quality over the next 12-18 months," Nishio added.

Moody’s said it expects Olympus will keep its competitive position in the markets for gastrointestinal endoscopy equipment and other key products and will use positive free cash flow to future acquisitions and debt reduction.

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