Moody’s ups Heinz to Baa3, debt to Baa2

Moody's Investors Service said it upgraded the senior unsecured debt ratings of H.J. Heinz Co. and subsidiaries by five notches to Baa3 from B2 and its senior secured debt to Baa2 from B1.

This follows the approval by Kraft Foods Group, Inc. shareholders of the pending merger of Kraft into Heinz to form Kraft Heinz Foods Co.

The agency also assigned definitive Baa3 ratings to roughly $12 billion-equivalent of senior unsecured notes and $4.6 billion of senior unsecured credit facilities previously offered and assigned provisional Baa3 ratings.

The outlook on all ratings is stable.

This action concludes the review for upgrade that began on March 25 following the announced merger agreement between Heinz and Kraft.

Upon consummation of the merger, Kraft will cease to exist and its long-term issuer rating will be withdrawn. All existing debt instruments of Kraft will become direct obligations of or will be guaranteed by the surviving Kraft-Heinz Foods operating company. These obligations will also be guaranteed by the public reporting parent company H.J. Heinz Holding Corp. to be renamed Kraft Heinz Co.

Kraft's senior unsecured debt will rank equally with all senior unsecured debt of Kraft Heinz Foods and subsidiaries ($1 billion of debt issued at a Canadian subsidiary will be guaranteed by Kraft-Heinz).

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