Moody’s reviews Stryker for downgrade

Moody’s Investors Service said it placed the Baa1 senior unsecured ratings of Stryker Corp. under review for downgrade on news the company plans to acquire Wright Medical Group NV in a transaction valued at $5.4 billion.

“The review for downgrade reflects higher financial leverage resulting from the acquisition. Moody’s estimates that pro forma debt/EBITDA will rise from approximately 2.3x to approximately 3.5 times based on financials for the twelve months ended Sept. 30, 2019. The review for downgrade also reflects the potential for integration risk and the company's apparently increasing acquisition appetite. This transaction follows several other acquisitions over the past two years totaling more than $2.5 billion,” Moody’s said in a press release.

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