Fitch: Seagate notes BBB-

Fitch Ratings said it assigned a BBB- rating to Seagate HDD Cayman's proposed issuance of $1 billion of senior unsecured notes due in 2023.

The notes will be guaranteed by parent company Seagate Technology plc.

The outlook is stable.

Seagate Technology has an issuer default rating of BBB- and a senior unsecured credit facility of BBB-.

Seagate HDD Cayman has an issuer default rating of BBB-, senior unsecured debt rating of BBB- and a senior unsecured credit facility rating of BBB-.

Fitch said it believes Seagate's debt issuance will have minimal effect on its consolidated leverage and strengthen interest coverage in the intermediate term as the vast majority of the net proceeds from the debt offering will be used to repay existing debt with high coupon rates.

The ratings reflect expectations for relatively stable hard disk drive pricing going forward due to a highly consolidated industry structure, the agency said.

Seagate's solid liquidity and financial flexibility are supported by $1.9 billion in cash, the vast majority of which is readily accessible without adverse tax considerations, Fitch said. The company generally has positive annual free cash flow and an undrawn $500 million senior unsecured revolving credit facility due 2018, the agency added.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.