Fitch rates Huntington Ingalls notes BBB-

Fitch Ratings said it assigned a BBB- rating to Huntington Ingalls Industries, Inc.'s issuance of $600 million senior unsecured notes due 2027.

The company intends to use the proceeds to repay the $600 million of 5% senior unsecured notes due 2021 at a redemption price of 102.5% of par.

The new notes will be governed by a new indenture and will rank pari pasu with other senior unsecured obligations of the company. The new indenture does not differ materially from other indentures governing Huntington Ingalls’ outstanding senior unsecured notes dated Dec. 2, 2014 and Nov. 17, 2015.

Fitch's ratings for Huntington Ingalls will cover about $1.3 billion of long-term debt after giving effect to the announced debt issuance and expected repayment of the notes maturing in 2021.

The outlook is stable.

Fitch said the ratings are supported by Huntington Ingalls’ strong operating performance and cash generation, solid liquidity, and large and highly visible backlog with long lead times, which should allow the company to adjust its cost structure in a timely manner if the U.S. Navy's 30-year shipbuilding plan changes dramatically and unexpectedly.

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