S&P rates Constellation Brands notes BBB-

S&P said it assigned its BBB- issue-level rating to Constellation Brands Inc.'s proposed senior unsecured notes (the actual amounts and maturity dates will be finalized at the transaction's closing). The company expects to use net proceeds to repay upcoming debt maturities.

“We believe Constellation will maintain its credit measures near trailing-12-month levels, including debt to EBITDA near or below 3.5x. Although we expect the company will remain acquisitive following its recently announced financial priorities (which include a target dividend payout ratio of 25%-30% of earnings, ongoing capital expenditures to expand beer production capacity in Mexico, and growth acquisitions), the company has indicated that it expects to manage these priorities while targeting debt to EBITDA of 3.5x,” S&P said in a news release.

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