S&P rates Walgreen notes BBB

Standard & Poor’s said it affirmed all of the existing ratings on Walgreen Co., including its BBB corporate credit rating and A-2 short-term rating.

The agency also said it assigned a BBB corporate credit rating and A-2 short-term rating to Walgreens Boots Alliance Inc., which will become the parent of Walgreen.

Walgreens Boots will become a parent holding company with Walgreen as a direct wholly owned subsidiary and Alliance Boots GmbH will be an indirect wholly owned subsidiary.

S&P also said it assigned the BBB ratings to various tranches of dollar-denominated senior unsecured debt.

The proceeds will be used to fund cash consideration for the second step of Alliance Boots acquisition, refinance substantially all of Alliance Boot’s long-term debt and retire Walgreen’s 2015 debt maturity, the agency said.

Walgreen’s business risk reflects its strong competitive position with large scale and good track record of sales and cash flow growth, S&P said.

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