Moody's assigns Kraft floaters Baa2

Moody's Investors Service said it assigned a Baa2 senior unsecured rating to $800 million of floating-rate notes due 2013 issued by Kraft Foods Inc.

The outlook is developing, pending final details on the company's plan to distribute its North American grocery business to its shareholders in a tax free spinoff.

Net proceeds from the notes offering will be used for general corporate purposes, which may include the partial prefunding of upcoming debt maturities.

Moody's said Kraft's Baa2 rating is supported by its global market presence, leading category market shares, and its broadly diversified portfolio of branded packaged food products.

These strengths are enhanced by the company's access to fast-growing developing markets such as India and Brazil, and significant clout in the global confectionery business.

However, the strengths are balanced against relatively high financial leverage for the Baa2 rating category and a history of aggressive financial policy, the agency said.

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