S&P lowers Aetna, lifts Humana, rates Aetna notes A-

S&P said it removed the ratings of Aetna Inc.’s and Humana Inc.’s holding companies from CreditWatch with negative and positive implications, respectively.

The ratings on these companies were initially placed on CreditWatch in July 2015.

S&P also said it lowered the financial strength ratings on Aetna's core operating companies to A+ from AA-.

The agency also said it lowered the counterparty credit ratings on Aetna and Aetna Health Holdings LLC to A- and A-2 from A and A-1.

S&P also said it raised the financial strength ratings on Humana's core operating companies to A+ from A and raised the long-term counterparty credit ratings on Humana to A- from BBB+ while affirming its short-term counterparty credit rating at A-2.

The outlook on the core operating and holding companies of both companies is negative.

The agency also said it assigned A- senior debt ratings to Aetna's senior notes issue.

The ratings on Aetna Health Insurance Co. of Europe Ltd., Humana Health Plans of Puerto Rico, Humana Insurance of Puerto Rico Inc. and Kanawha Insurance Co. are unaffected.

Aetna and Humana have received shareholder and significant state-level approval for their proposed merger and the deal is expected to close in the second half of 2016, S&P said.

Overall, the merger should be transformational in nature.

The deal makes strategic sense as it could enhance the overall business profile of the combined enterprise if properly integrated and synergies are realized, the agency said.

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