Moody's ups Service Corp., rates revolver Baa2

Moody's Investors Service said it upgraded the corporate family and probability of default rating of Service Corp. International to Ba2 from Ba3, and assigned a Baa2 (LGD 1, 7%)rating to its proposed $500 million amended revolving credit facility due 2016.

The $500 million revolver due 2016 will replace a $400 million revolver maturing in 2013, Moody's said.

Concurrently, Moody's upgraded the senior note ratings to Ba3 from B1 and the speculative grade liquidity rating to SGL-1 from SGL-2.

The outlook was changed to stable from positive.

The agency also said it upgraded the company's $9 million of 7 7/8% senior unsecured debentures due 2013 to Ba3 (LGD 4, 62%) from B1 (LGD 4, 61%);

• $181 million of 7 3/8% senior unsecured notes due 2014 to Ba3 (LGD 4, 62%) from B1 (LGD 4, 61%); $157 million of 6¾% senior unsecured notes due 2015 to Ba3 (LGD 4, 62%) from B1 (LGD 4, 61%);

• $213 million of 6¾% senior unsecured notes due 2016 to Ba3 (LGD 4, 62%) from B1 (LGD 4, 61%); $295 million of 7% senior unsecured notes due 2017 to Ba3 (LGD 4, 62%) from B1 (LGD 4, 61%);

• $250 million of 7 5/8% senior unsecured notes due 2018 to Ba3 (LGD 4, 62%) from B1 (LGD 4, 61%); $250 million of senior unsecured notes due 2019 to Ba3 (LGD 4, 62%) from B1 (LGD 4, 61%);

• $150 million of 8% senior unsecured notes due 2021 to Ba3 (LGD 4, 62%) from B1 (LGD 4, 61%); $200 million of 7½% senior unsecured notes due 2027 to Ba3 (LGD 4, 62%) from B1 (LGD 4, 61%); and

• Senior unsecured shelf to provisional Ba3 (LGD 4, 62%) from provisional B1 (LGD 4, 61%).

The upgrades reflect the company's track record of steady financial performance through the recent economic downturn and improved results in fiscal 2010, stable cash flow generation and a demonstrated commitment to conservative financial policies, Moody's said.

The ratings are constrained by weak near-term funeral volume trends, a steady increase in cremation rates, potential volatility in trust performance and the susceptibility of pre-need cemetery sales to a difficult economic climate, the agency said.

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