Moody’s gives Phillips 66 notes A3

Moody’s Investors Service said it assigned A3 ratings to Phillips 66's proposed offerings of three tranches of senior notes totaling $1.5 billion.

Proceeds will be used to repay short-term borrowings under its commercial paper program used for share buybacks and for general corporate purposes.

All existing ratings of Phillips 66, including the A3 long-term issuer and senior unsecured ratings, are unchanged. The outlook is negative.

"Phillips 66's issuance of notes will establish long-term debt financing for a portion of the recent $3.3 billion share repurchase that was funded with CP and existing cash balances," James Wilkins, Moody's vice president and senior analyst, said in a news release.

"While this transaction will not increase total debt levels, the share repurchase, which was funded with roughly 55% cash and 45% debt, increased leverage.”

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