Moody's rates Hershey notes A2

Moody's Investors Service said it assigned an A2 rating Hershey Co.'s 10-year senior notes due December 2020.

The outlook is stable.

Proceeds from the new notes will be used partly to fund a cash tender offer of $150 million of 6.95% notes due 2012. Remaining proceeds will be used for general corporate purposes.

The rating is supported by the company's stable cash flows, attractive operating margins, solid liquidity and leading position in the U.S. chocolate confectionery market, Moody's said.

The rating is constrained by Hershey's modest size relative to peers, limited product and geographic diversity, history of corporate governance conflicts and acquisition event risk, the agency said.

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