Fitch rates DaVita note B

Fitch Ratings said it assigned a B rating to DaVita Inc.'s $400 million 6 5/8% senior unsecured notes due 2013, which are part of the same series of notes as DaVita's $500 million 6 5/8% senior unsecured notes due 2013 that were issued in March 2005.

The outlook is stable.

The agency expects DaVita to use the proceeds from the issuance to reduce amounts outstanding under the term loan portion of its senior secured credit facility. At Sept. 30, DaVita had $279 million outstanding on its term loan A, $2.181 billion outstanding on its term loan B and an undrawn $253 million revolver with $49 million in letters of credit outstanding.

DaVita's B+ issuer default rating reflects significant debt levels and an uncertain regulatory environment, Moody's said.

At the same time, the agency said DaVita has demonstrated improved financial performance for the past several quarters, including a decrease in the total debt with equity credit-to-operating EBITDA ratio to 4.49x for the last 12 months ended Sept. 30 from 6.85x at the end of 2005.

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