Moody's upgrades Grifols

Moody's Investors Service said it upgraded to Ba2 the corporate family rating of Grifols SA.

The agency also upgraded to Ba1 the senior secured ratings issued by Grifols and the B1 senior unsecured rating issued by Giant Funding Corp.

The outlook is stable.

The action reflects strong levels of operating trading and continued progress made by the company in achieving planned synergies from the acquisition of Talecris Biotherapeutics Holding Corp., which was announced in June 2010 and completed in June 2011, according to the agency.

This has led to a leverage ratio of adjusted debt to EBITDA of 3.7x, Moody's said.

The action also reflects the sustainably high profitability with an EBITDA margin of above 30%.

The Ba2 corporate family rating incorporates the company's large scale and strong position in the global market for blood plasma derivatives, with a high degree of vertical integration; the numerous barriers to entry to the plasma derivatives market including; favorable market dynamics; and progress achieved to reduce debt and improve leverage, the agency said.

These strengths are balanced by the company's narrow diversification, Grifols' still relatively high but declining levels of leverage and the high impact/low probability safety risks relating to product contamination, the agency noted.

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