Moody’s changes Kroger view

Moody's Investors Service said it changed Kroger Co.'s outlook to negative from stable.

At the same time, Moody's affirmed Kroger's senior unsecured rating at Baa1 and its commercial paper rating at Prime-2.

The actions follow the definitive agreement entered into for Kroger to acquire Albertsons Cos., Inc. for $34.10 per share in a largely debt-financed transaction valued at roughly $25 billion.

“The change in outlook to negative reflects that Kroger's acquisition of Albertson's will result in meaningfully higher debt levels which will result in a long-term negative impact to credit metrics, particularly interest coverage,” the agency said in a news release.

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