Moody’s rates Owens & Minor notes Ba1

Moody's Investors Service said it assigned Ba1 ratings to Owens & Minor, Inc.'s proposed $300 million and $250 million senior unsecured notes.

In a related action, the agency affirmed the company's Ba1 corporate family rating and Ba1-PD probability of default rating and assigned a speculative grade liquidity rating of SGL-2.

The outlook is stable.

Proceeds from the proposed transaction are expected to be utilized to redeem the company's existing $200 million 6.35% senior unsecured notes due 2016, fund the acquisition of Medical Action Industries and for general corporate purposes.

Moody’s said that while the transaction increases the company's funded debt to $550 million from $200 million resulting in almost a turn of additional leverage from the low current adjusted debt to EBITDA level of near 2 times, leverage remains within the Ba1 rating tolerance.

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