Fitch assigns BBB- to Marvell

Fitch Ratings said it assigned a long-term issuer default rating of BBB- to Marvell Technology Group Ltd.

The outlook is stable.

The company currently has no outstanding debt, although the agency expects the company will issue debt to partially fund the pending acquisition of Cavium Inc.

Fitch said the ratings and outlook reflect its expectation for positive and more stable revenue growth, pro forma for Marvell's roughly $6 billion acquisition of Cavium, driven by the company's No. 1 or No. 2 share positions, longer-product life cycles and broader franchise portfolio in secular growth infrastructure markets.

Higher revenue levels and expectations for the realization of the majority of projected cost synergies should result in structurally higher operating profit margins through an economic cycle, enabling Marvell to use FCF for rapid de-leveraging and achieve its 1.5 times total leverage target within 12 to 24 months post-acquisition, the agency explained.

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