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Fitch rates Altria notes BBB+
Fitch Ratings said it assigned a BBB+ rating to Altria Group, Inc.'s issuance of $1.5 billion of 4¾% 10-year guaranteed senior unsecured notes.
The notes will rank pari passu with Altria's other senior debt and be issued under Altria's indenture dated Nov. 4, 2008, Fitch said.
The proceeds will be used for general corporate purposes and fund share repurchases under a $1 billion program announced in January.
The ratings reflect the company's continued ability to generate substantial cash flow from operations due to high operating margins, significant liquidity and commanding market share position in the U.S. tobacco industry, Fitch said.
The ratings further consider Altria's shareholder-friendly high target dividend payout ratio - increased last year to 80%, the agency said.
While Altria relies heavily upon cigarette sales, the company's ratings are supported by its diversification of operations within the tobacco space and the company's large stake in SABMiller plc, one of the world's largest brewers, Fitch added.
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