Moody’s provides Ba2 to Molina notes

Moody's Investors Service said it assigned a Ba3 senior unsecured debt rating to Molina Healthcare, Inc.'s $500 million of seven-year senior unsecured notes.

Proceeds will be used for general corporate purposes, including bolstering statutory capital to support expansion and acquisitions.

In the same action, the agency assigned Baa3 insurance financial strength ratings to six of Molina's regulated operating subsidiaries.

The outlook on the ratings is stable.

Moody's said the Baa3 insurance financial strength ratings of Molina's operating subsidiaries and the Ba3 senior debt rating of Molina are based primarily on the company's concentration in the Medicaid market, acquisitive nature, low margins and high level of financial leverage. This is offset by its multi-state presence and a growing non-regulated management information systems business.

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