Fitch rates Kroger notes BBB

Fitch Ratings said it assigned a BBB rating to Kroger Co.'s new $500 million 3.9% senior unsecured notes due 2015.

The outlook is stable.

Proceeds from the offering will be used to refinance existing debt and for general corporate purposes.

The agency said the rating reflects Kroger's successful operating strategy, which has allowed the company to achieve industry-leading identical-store sales trends; its ability to generate cost efficiencies and strong cash flow; and its conservative financial management.

The rating also considers the challenging economic environment and intense competition in the sector, which are expected to continue to pressure operating profitability, Fitch said.

For the last 12 months ended Aug. 15, the total adjusted debt-to-operating EBITDAR ratio was 2.9 times.

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