S&P rates Avnet notes BBB-

S&P said it assigned a BBB- rating to Avnet Inc.'s proposed issue of $300 million five-year senior unsecured notes.

The proceeds will be used to repay existing debt, S&P said.

Avnet's adjusted leverage was in the low 2x range as of Oct. 1, pro forma for the Premier Farnell acquisition, the agency said, and the application of net cash proceeds from its Technology Solutions segment divestiture.

S&P said it expects leverage to decline to the mid- to high-1x range over the next 12- to 18-months because of EBITDA expansion and cash build.

As a result, the company will create some capacity to support its acquisition growth strategy and shareholder return initiatives without affecting the current rating, the agency said.

The ratings also reflect the company's good position and large scale within the global electronics components distribution industry, good vendor relationships and potentially countercyclical working capital investments, S&P said.

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