Moody’s affirms Wesfarmers

Moody's Investors Service said it affirmed Wesfarmers Ltd.'s A3 issuer and senior unsecured ratings and P-2 short term issuer ratings.

At the same time, the agency affirmed the provisional P-2 short-term ratings of NZ Finance Holdings Pty Ltd.

The outlook is stable.

Moody’s said the actions follow the announcement of Wesfarmers' intention to demerge its Coles division.

"The demerger of Coles is negative from credit perspective, due to the resulting reduction in scale, business diversification, and stability of earnings" Ian Chitterer, Moody's vice president and senior credit officer, said in a news release.

"That said, Moody's has affirmed Wesfarmers' rating and left the outlook at stable as we expect that, in order to maintain its targeted A3 ratings, management will reduce leverage to compensate for these negative impacts.”

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