S&P puts LabCorp on watch

Standard & Poor’s said it placed all of its ratings on Laboratory Corp. of America Holdings, including the BBB+ corporate credit rating, on CreditWatch with negative implications.

This action reflects LabCorp’s intention to acquire contract research organization Covance Inc. in a largely debt-financed transaction. Pro forma for the transaction, S&P estimates debt leverage will be more than 4x, a meaningful departure from the company’s long-term leverage target of around 2.5x, the agency said.

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