Moody's ups Magellan Health loan to Ba3

Moody's Investors Service said it upgraded the corporate family, senior secured bank credit facility and senior secured term loan ratings for Magellan Health Services, Inc. to Ba3 from B1.

The outlook is stable.

The upgrade reflects the company's improved financial flexibility caused primarily by the significant decline in leverage over the past two years, the agency said.

The stable outlook reflects the company's reduced leverage, its ability to generate cash flow on an annual basis and expected growth with the acquisitions of NIA and Icore.

The ratings could face downward pressure if Magellan was to pursue a significant, debt-financed transforming type of acquisition, resulting in much less financial flexibility than it currently enjoys, the agency said.

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