S&P cuts AmerisourceBergen

S&P said it downgraded AmerisourceBergen Corp. and its senior unsecured debt to BBB+ from A- and removed the ratings from CreditWatch with negative implications where they were placed on Jan. 6.

The downgrade follows AmerisourceBergen’s completing its acquisition of Alliance Healthcare from Walgreens Boots Alliance. The company paid nearly $6.3 billion in cash and $230 in common stock for Alliance Healthcare.

“The downgrade and negative outlook reflect the significant increase in the company's adjusted net leverage and the potential that its leverage will remain above 2.5x over the longer term. With its acquisition of Alliance Healthcare, and the inclusion of an estimated $4 billion of liabilities related to ongoing opioid litigation, we forecast normally very conservative AmerisourceBergen's adjusted net leverage will rise to more than 3x while its funds from operations (FFO) to adjusted net debt remains below 35%,” S&P said in a press release.

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