Moody's rates Ferrellgas notes B2

Moody's Investors Service said it assigned a B2 rating to Ferrellgas Partners, LP's proposed offering of $280 million senior unsecured notes due 2020 and affirmed its Ba3 corporate family rating and the Ba3 ratings on subsidiary Ferrellgas LP's senior unsecured debt.

The outlook is stable.

Refinancing the 2012 notes strengthens Ferrellgas' debt maturity profile, according to the agency.

The agency said it expects working capital borrowings to be reduced over the remainder of fiscal year, keeping its adjusted debt-to-EBITDA ratio in line with the 4.8x level that the partnership had at July 31, 2009.

Ferrellgas' Ba3 corporate family rating is supported by its leading market position and geographic diversification, the agency said.

The rating is constrained by its still higher leverage and weaker distribution coverage than its propane peers, the agency said.

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