Moody’s assigns A3 to Phillips 66 notes

Moody's Investors Service said it assigned A3 ratings to the proposed floating-rate notes to be issued by Phillips 66.

The outlook is negative.

Proceeds from the notes and new term loans that the company will enter into concurrently with the notes issuance will be used to refinance maturing debt, for capital expenditures and for general corporate purposes.

"Phillips 66 is refinancing the $1.5 billion of debt maturing 1 May 2017 and balance sheet debt will not change meaningfully in 2017," Moody's vice president, senior analyst James Wilkins said in a news release.

"However, the terms of the new debt and short duration of the notes will allow the company the flexibility to repay debt as well as drop debt down to its logistics MLP, Phillips 66 Partners."

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