Moody's rates Hughes notes Ba1

Moody's Investors Service said it assigned a Ba1 rating to Hughes Supply Inc.'s $300 million guaranteed senior unsecured notes due 2014 and assigned a Ba2 senior unsecured issuer rating, a Ba1 senior implied rating and an SGL-1 rating to the company.

The outlook is stable.

Moody's said Hughes' ratings are based on its comparatively high operating leverage and significant financial leverage, the challenges associated with its continuing efforts to transform its business model for enhanced profitability and the risks associated with its acquisition strategy.

The ratings are supported by Hughes' leading position in its domestic distribution market, emphasis on areas expected to exceed national averages for population growth, diversification of end-use markets and customer base and experienced management team, according to Moody's.

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