Moody's rates Emerson notes A2

Moody’s Investors Service said it assigned A2 ratings to Emerson Electric Co.’s senior unsecured notes due 2028 through 2051.

The agency said it also affirmed Emerson’s A2 rating and changed the outlook to stable from under review. This concludes the review for downgrade started on Oct. 11.

Emerson will use the proceeds, cash and short-term borrowings to fund the about $6 billion cash contribution to a newly created joint venture with Aspen Technologies, Inc.

“The stable ratings outlook reflects Moody's expectations for modest organic revenue growth through fiscal year 2023 with EBITA margins in the upper teens percentage range. Moody's expects Emerson to apply a substantial portion of its free cash flow toward debt reduction in 2022 and beyond as necessary to achieve debt to EBITDA in the mid- to low-2x range,” the agency said in a press release.

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