Moody's affirms Perdigao

Moody's Investors Service said it affirmed Perdigao SA's Ba1 corporate family rating following the company's announced bid to acquire Eleva Alimentos SA for R$1.67 billion in equity plus R$547 million in assumed debt.

The outlook remains stable.

"The affirmation of Perdigao's rating is based on the strategic fit of Eleva's businesses in Perdigao's longer-term business diversification strategy; the improved size and scale of the combined companies, considerable synergy opportunities, as well as, the fact that the transaction will be financed with equity so that Perdigao's current leverage will not be significantly impacted," Moody's analyst Soummo Mukherjee said in a written statement.

"These positive factors mitigate the challenges that Perdigao might face to successfully integrate Eleva, the additional debt that Perdigao will incur (approximately R$547 million at the end of September 30) and the lower operating margins of Eleva compared to Perdigao," Mukherjee said.

The issuer's total debt-to-EBITDA ratio rises to 2.1 times from 2 times, based on the 12 months ending Sept. 30.

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