Moody's downgrades CVS Health

Moody's Investors Service said it downgraded CVS Health's senior unsecured rating to Baa2 from Baa1 and affirmed its P-2 short-term commercial-paper rating.

The outlook is negative.

This concludes a review that began last December following CVS's and Aetna, Inc.'s announcement that CVS would be acquiring Aetna, Moody's explained.

The combination of CVS and Aetna will create a one of a kind vertically integrated healthcare company with huge scale and mark an industry shift toward a more seamless approach to managing healthcare costs, the agency said.

This merger brings together the overall management of a patient's medical bills and prescription drugs under one umbrella, Moody's said.

But, the transaction will result in significant weakening of CVS' credit metrics as it will be financed with a large amount of debt and will come with high execution and integration risks, the agency said.

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