Moody’s rates Hexcel debt Baa3

Moody's Investors Service said it assigned a Baa3 rating to Hexcel Corp.'s new senior unsecured debt.

All other ratings and the stable outlook are unchanged on to the expectation that the transaction will lead to a very modest increase in leverage and will not weaken the company's strong credit metrics.

Proceeds will be used to pay down borrowings under the existing revolving credit facility and for general corporate purposes, including the repurchase of shares.

Moody’s said the Baa3 rating reflects Hexcel's robust credit metrics, low financial leverage, and leadership position as a manufacturer of high performance structural materials for aerospace and industrial end-markets.

The agency believes Hexcel has above average earnings and cash flow growth prospects driven by the company's strong competitive standing (underpinned by meaningful barriers to entry and long-term customer contracts) and its significant content on growing commercial programs such as the A350, 737MAX and A320neo.

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