Fitch rates Anthem units BBB-

Fitch Ratings said it assigned an expected BBB- rating to Anthem, Inc.’s planned issue of subordinated equity units due 2028.

The proceeds will be used from the planned issuance for general corporate purposes, including re-purchasing a portion of its currently outstanding 2.75% convertible debentures due 2042.

Given the convertible debentures’ conversion price and Anthem’s current share price, Fitch said it believes the company will likely pay premiums when re-purchasing the 2.75% convertible debentures.

The agency said it expects the company’s financial-leverage ratios to increase modestly as a result of the issuance.

The ratings continue to reflect the company’s strong competitive position, consistent financial performance and solid debt capabilities, Fitch said.

The ratings also consider its high financial leverage, the agency said.

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