Moody's affirms Express

Moody's Investors Service said it affirmed Express Scripts Inc.'s Baa3 long-term debt ratings on its senior unsecured notes and senior unsecured shelf rating following news that it has entered into a definitive merger agreement with Medco Health Solutions for about $29.1 billion.

Moody's said it understands that financing is expected to consist of about 60% equity and 40% cash consideration.

The agency also said it revised its outlook to stable from positive.

The transaction is expected to close in the first half of 2012, subject to regulatory and shareholder approvals.

Although a transaction of this magnitude was not anticipated, Moody's said it believes that Express Scripts will remain committed to de-leveraging and expects the company will achieve investment-grade metrics relatively quickly.

Despite potential strategic benefits gained in combining two of the nation's largest pharmacy benefit management companies, integration risks provide some concern, especially in light of recent challenges facing Medco, the agency said.

© 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.