Moody's rates HCA notes Ba2

Moody's Investors Service said it assigned a Ba2 (LGD3) rating to HCA, Inc.’s proposed offering of $1.5 billion of senior secured notes due 2019 and 2025. The company is a subsidiary of HCA Holdings, Inc., whose Ba3 corporate family rating and Ba3-PD probability of default rating are unchanged. The outlook is stable.

The note proceeds will be used predominantly to fund the redemption of the company's $1.4 billion of 7¼% senior secured notes due 2020.

HCA's Ba3 corporate family rating reflects Moody's expectation that HCA's scale and dominant market strength will allow the company to continue to grow revenue and maintain healthy EBITDA margins.

The agency anticipates that the company will continue to return capital to shareholders in lieu of debt repayment, but Moody’s said it expects that HCA will generate enough cash to fund moderate-sized acquisitions with little detrimental impact on credit metrics. Moody's expects that the company will operate with debt to EBITDA in the range of 4.5 to 5 times.

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