Moody's rates GATX Prime-2

Moody's Investors Service said it assigned a Prime-2 short-term rating to GATX Corp. following the merger of GATX Financial Corp. into its parent GATX. In connection with the merger, GATX assumed all of GATX Financial's obligations.

The outlook is stable.

The agency said that many aspects of its analysis of GATX have been based on a consolidated view of capital, leverage and liquidity due to GATX Financial's guaranty of its parent's debt and GATX's reliance on GATX Financial dividends to meet its debt service requirements. By doing away with inter-company accounts, distributions and support between GATX Financial and its parent, the merger will improve the transparency of GATX's financial position, which Moody's views positively.

On a combined basis, GATX's ratings are supported by its strong railcar leasing franchise, its improved capital position and liquidity profile and expectations that its operating performance will exhibit greater stability and stronger risk-adjusted returns under its refined strategy, Moody's said.

The firm's industry and business concentrations, associated cyclicality and leverage profile are constraints to its ratings, the agency added.

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