Fitch cuts Anheuser-Busch

Fitch Ratings said it downgraded and removed from Rating Watch negative Anheuser-Busch Companies, Inc.'s issuer default rating to BBB from A, short-term issuer default rating to F2 from F1, commercial paper to F2 from F1, bank credit facilities to BBB from A and senior unsecured notes to BBB from A.

The outlook is negative. Fitch has subsequently withdrawn ratings.

InBev NV is acquiring Anheuser for $52.2 billion, or a multiple of 11.5 times trailing 12 months EBITDA plus trailing 12 months equity income. To complete the financing for the acquisition, InBev has obtained a $45 billion debt facility and a $9.8 billion equity bridge facility.

InBev said that, as a consequence of unprecedented volatility in the global capital markets, it has postponed its previously announced rights offering until market conditions stabilize.

The downgrade reflects a combined company that initially will be levered beyond the rating but also one that has demonstrated financial discipline, an ability to absorb and profit from a large acquisition and strong fundamentals to maintain a leadership position in a consolidating global beer market, according to the agency.

The debt-to-EBITDA ratio is expected to be about 3x to 3.5x by year-end 2011.

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