Fitch rates Altria notes BBB+

Fitch Ratings said it assigned a BBB+ rating to Altria Group, Inc.'s benchmark issue proposed offering of guaranteed senior notes due 2015. The notes will rank pari passu with Altria's other senior debt. The company's ratings include an issuer default rating of BBB+, guaranteed bank credit facilities at BBB+, guaranteed senior unsecured debt at BBB+, short-term issuer default rating at F2 and commercial paper at F2. Its subsidiary, Philip Morris Capital Corp., has an issuer default rating of BBB+, short-term issuer default rating of F2 and commercial paper of F2. Recently acquired UST Inc. has a senior unsecured debt rating of BBB+.

The notes are being issued under Altria's indenture dated Nov. 4, 2008, and significant covenants include limitations on liens and restrictions on sale leaseback transactions, Fitch said. The company plans to use the proceeds for general corporate purposes.

The ratings reflect the company's continued ability to generate substantial cash flow from operations due to high operating margins, significant liquidity and leading market share position in the U.S. tobacco industry, Fitch said.

The ratings further consider Altria's shareholder-friendly high target dividend payout ratio - recently increased to 80%, the agency said.

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