Moody’s gives Baa2 to Quest Diagnostics notes

Moody's Investors Service said it assigned a Baa2 rating to Quest Diagnostics Inc.’s proposed offering of a total of $1.2 billion senior unsecured notes due 2020, 2025 and 2045.

The agency does not expect a meaningful change in Quest's leverage given the intended use of proceeds.

The stable outlook is unchanged.

Moody's expects the proceeds to be used, along with cash on hand and borrowings under the company's secured accounts receivable credit facility, to refinance certain outstanding notes. These include the announced tender offers to purchase up to $250 million in combined aggregate principal amount of Quest's outstanding 6.95% senior notes due 2037 and 5.75% senior notes due 2040. Additionally, the company plans to redeem all $500 million of the outstanding 5.45% senior notes due 2015, all $375 million of the outstanding 6.4% senior notes due 2017, and $150 million (50%) of the outstanding 3.2% senior notes due 2016.

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