S&P rates Walgreen loan BBB

Standard & Poor’s said it assigned a BBB rating to the £ 1.45 billion term loan co-issued by Walgreen Co. and Walgreens Boots Alliance Inc.

The agency also said it assigned a BBB rating to Walgreen Co.’s $3 billion revolving credit facility.

The proceeds, along with recently issued $8 billion, € 750 million and £ 700 million senior unsecured notes, will be used to fund cash consideration for the second step of Alliance Boots acquisition, replace its existing $1.35 billion revolving credit facility, refinance substantially all long-term debt of Alliance Boots and retire Walgreen’s 2015 debt maturity, S&P said.

Given an expectation for strong cash-flow generation and the company’s balanced maturity profile with pre-payable debt, the agency said it anticipates Walgreen will reduce its outstanding debt balances.

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