S&P rates VMware notes, loan BBB-

S&P said it assigned its BBB- corporate credit rating to VMware Inc. The outlook is stable.

S&P said it is also assigning a BBB- issue-level rating on the company's proposed unsecured revolving credit facility and proposed senior unsecured notes.

“Our rating on VMware reflects the company's strong brand recognition, size, and market position in the infrastructure software market, growing recurring revenue mix, its significant free operating cash flow generation, and net cash position,” S&P said in a news release.

“Partly offsetting these positive factors include the headwind it faces related to the ongoing migration of workload from on-premise data centers to public cloud, strong competition from established technology firms with significant financial resources, and increasing shareholder return activities.”

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