Moody's may cut Renal Care

Moody's Investors Service said it placed the ratings of Renal Care Group, Inc. under review for possible downgrade following the company's announcement that it had entered into a definitive agreement to be acquired by Fresenius Medical Care AG.

On review are Renal Care's B1 rated senior subordinated notes due 2011, Ba2 senior implied rating and Ba3 senior unsecured issuer rating.

The all-cash transaction, which totals $3.5 billion, includes the assumption of Renal Care Group's debt of about $500 million.

Moody's said its review will focus primarily on the position of the company's debt in the capital structure of the combined company.

In addition, the rating agency said it would evaluate the affect the combined company's financial policy will have on Renal Care Group's existing creditors.

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