Moody’s assigns KLA-Tencor notes Baa2

Moody's Investors Service said it assigned a Baa2 rating KLA-Tencor Corp.’s proposed senior unsecured issuance.

Proceeds are expected to support funding of a $4 billion distribution to shareholders.

The outlook is stable.

The rating reflects KLA's "more aggressive financial policy as the company raises up to $2.5 billion of incremental debt in order to distribute $4.0 billion to shareholders," Moody's senior vice president Richard Lane said in a news release. The capital allocation plan will consist of a $2.75 billion one-time special dividend and $1.25 billion of share repurchase to be executed over the next 12 to 18 months.

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