Moody's affirms Inco, Falconbridge

Moody's Investors Service said it has affirmed the Baa3 senior unsecured debt ratings of both Inco Ltd. and Falconbridge Ltd. following Inco's announcement that it is increasing its offer to purchase up to 100% of Falconbridge by about $1.7 billion.

Moody's affirmed Inco's senior unsecured debt at Baa3 and convertible subordinated debt at Ba1.

Moody's affirmed Falconbridge's senior unsecured debt at Baa3.

The Baa3 rating reflects the size, diversity and asset and reserve positions of the companies, whether combined or not, the agency noted.

The rating also reflects Moody's view that metals prices will continue to be robust over the near term, resulting in what should be a period of strong cash flow.

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