S&P rates St. Jude convertibles BBB+

Standard & Poor's said it assigned a BBB+ rating to St. Jude Medical Inc.'s $600 million convertible senior debentures due 2035.

Ratings on the company were affirmed, including the BBB+ long-term corporate credit rating, BBB+ unsecured bank loan rating and A-2 commercial paper rating.

Proceeds of the financing will be used to pay down commercial paper used to finance the $1.3 billion acquisition of Advanced Neuromodulation Systems Inc., completed in November.

S&P said the rating reflects St. Jude's portfolio of leading medical devices, which generate solid cash flow, as well as its conservative financial policies and strong debt protection measures.

These factors mitigate the company's vulnerability to technological change within its relatively narrow disease focus areas (cardiology), the risks of competing with larger, diversified rivals and its exposure to reimbursement risk and pricing pressures typical for health care industry participants, the agency said.

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