Moody's may lower Wolters Kluwer

Moody's Investors Service said it placed the Baa1 senior unsecured and Baa2 junior subordinated long-term debt ratings of Wolters Kluwer NV under review for possible downgrade.

Moody's said the action follows the announcement that Wolters Kluwer has entered into a definitive agreement to acquire the information management business of NDCHealth Corp. for a total consideration of $382 million paid in cash.

Although, in Moody's opinion the NDC-IM acquisition makes strategic sense and usefully complements Wolters Kluwer's Health division as it extends the company's Pharma Solution business, the review for downgrade reflects Moody's concerns that against the still challenging operating environment and ongoing reorganization of its business, the additional cash outflows associated with the acquisition will delay improvement of Wolters Kluwer's cash flow-based debt protection measurements on which the current Baa1 rating is based.

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