S&P rates PepsiCo notes A-

Standard & Poor's said that it assigned an A- issue-level rating to PepsiCo Inc.'s senior note offering, consisting of two-year and five-year tranches.

PepsiCo has indicated that it plans to use the net proceeds from this offering for general corporate purposes.

PepsiCo's senior unsecured debt rating, which is at the holding company, reflects the opinion that this debt is structurally subordinated to priority obligations at its operating entities, which generate substantially all of its cash flow and account for a significant portion of total assets but which do not guarantee this debt, the agency said.

The A corporate credit rating reflects PepsiCo's balanced portfolio of businesses, with its strong positions and well-known brands in the relatively stable, cash-generating liquid refreshment beverage and snack food industries as well as geographic diversification, the agency added.

The company's somewhat more aggressive financial policies, including its active share repurchase and acquisition program, which have led to higher debt levels, partially offset those strengths, S&P said.

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