Fitch assigns Steris BBB

Fitch Ratings said it assigned Steris plc, Steris Corp. and Steris Ltd. first-time issuer default ratings of BBB with stable outlooks in conjunction with its pending acquisition of Cantel Medical Corp. for $4.6 billion. Fitch also assigned BBB ratings to the senior unsecured credit facilities and existing notes.

“The BBB IDRs contemplate the combined company's comprehensive product offering in infection prevention and leading national positions in its healthcare segment, offset in part by a narrower product and geographic focus compared with other BBB rated peers,” the agency said in a press release.

Fitch said it forecasts Steris will operate with gross debt/EBITDA of roughly 3x upon transaction close assuming a full year's contributions.

“Over the medium-to-long term, Fitch expects leverage will be between 2x and 3x depending on acquisitions and settle around 2.5x as Fitch believes the rationale for strategic M&A will remain intact,” the agency said.

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