Moody's downgrades Anixter

Moody's Investors Service said it downgraded Anixter International Inc.'s corporate family rating to Ba2 from Ba1, its 3.25% LYONs to B1 from Ba2 and Anixter Inc.'s $200 million guaranteed senior unsecured notes to Ba1 from Baa3.

The outlook was changed to stable from negative.

The agency said the downgrade reflects the company's increased leverage resulting from the recent $300 million offering of convertible senior notes and its recent history of debt-financed special dividends, share repurchases and acquisitions. Over the intermediate term, Moody's believes that Anixter's credit profile is more consistent with a Ba2 corporate family rating given its current leverage, fairly aggressive financial philosophy, debt repayment limitations and the likelihood of an economic slowdown in the company's end markets.

Anixter's Ba2 corporate family rating continues to recognize the company's large and diversified customer base, reasonably stable earnings performance, good supplier relationships, broad geographic reach, counter-cyclical working capital needs, minimum capital expenditure requirements and good liquidity, Moody's said.

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