S&P rates Coca-Cola notes AA

Standard & Poor’s said it assigned an AA rating to the Coca-Cola Co.’s proposed senior unsecured euro notes, consisting of a €2 billion floating-rate tranche due in 2017, €2 billion floating-rate tranche due in 2019, €1.5 billion tranche due in 2023, €1.5 billion tranche due in 2027 and €1.5 billion tranche due in 2035.

The company is drawing these notes under its shelf registration.

The proceeds will be used for working capital, capital expenditures, acquisitions and repaying debt, S&P said.

Given Coke’s ongoing investment expenditures and the top-line and margin pressure from foreign-currency, the agency said it believes that the company’s credit measures will remain weak with adjusted debt-to-EBITDA of about 2x, the agency said.

The ratings also consider the company’s very strong position as the world’s largest non-alcoholic beverage company, anchored by well-known brands, above-average EBITDA margin and geographic diversification, S&P said.

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