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Published on 7/28/2015 in the Prospect News Bank Loan Daily and Prospect News Investment Grade Daily.

Moody's: Honeywell unaffected

Moody's Investors Service said its A2 senior rating for Honeywell International Inc. is unaffected by the company's planned acquisition of Elster Group GmbH. The acquisition, valued at $5.1 billion, is expected to close in the first quarter of 2016. Honeywell will fund the purchase primarily with overseas cash and some new debt issued by one or more of its U.S. subsidiaries.

"The acquisition will enhance Honeywell's environmental and combustion control offerings globally, which we believe will lead to top-line and margin expansion, favorably supporting its credit profile," Moody's senior credit officer Jonathan Root said in an agency news release.

"Funding the majority of the purchase price with cash will limit pressure on Honeywell's credit metrics. With offshore cash and short-term investments likely in excess of $9 billion come Dec. 31, Honeywell maintains significant capacity to fund this and other acquisitions and still maintain credit metrics that are supportive of the A2 senior unsecured debt rating."


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