Moody's: Del Monte up to positive, loan rated Ba3, notes B2

Moody's Investors Service said it changed the ratings outlook for Del Monte Corp. to positive from stable, assigned a Ba3 to the company's prospective senior secured credit facilities and a B2 to the company's prospective $250 million senior subordinated note issuance.

Del Monte Corporation is a wholly owned subsidiary of Del Monte Foods Co.

Moody's also affirmed Del Monte's $450 million 8 5/8% notes maturing 2012 at B2, Ba3 senior implied rating, B1 unsecured issuer rating and SGL-2 speculative grade liquidity rating.

Proceeds from the new credit facilities and senior subordinated notes will refinance the company's existing credit facilities and fund the repurchase of its 9¼% senior subordinated notes under a tender offer scheduled to expire Feb. 10.

Moody's said the change in ratings outlook to positive reflects Del Monte's consistent cash flow generation and the expectation that Del Monte will continue to apply free cash flow to further debt pay-down.

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