Fitch drops Abbott to negative

Fitch Ratings said it affirmed the ratings and revised Abbott Laboratories' outlook to negative from stable.

The outlook revision follows the company's announced agreement to acquire CFR Pharmaceuticals for about $2.9 billion in cash and the assumption of about $500 million of CFR Pharmaceutical's gross debt, Fitch said.

The agency also affirmed Abbott's issuer default rating at A+, senior unsecured bank loan rating at A+, senior unsecured debt rating at A+, short-term issuer default rating at F1 and commercial-paper rating at F1.

While Fitch said it believes the acquisition of CFR makes strategic sense, it limits the company's willingness and ability to reduce leverage to less than 1.5x.

The ratings also consider the continued weak employment environment in the United States and government austerity measures in Europe that weigh on Abbott's growth and margins in the developed markets, the agency said.

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