Moody’s rates Anheuser-Busch bond A3

Moody's Investors Service said it assigned a provisional A3 rating to a $1.47 billion bond issued by Anheuser-Busch InBev Finance Inc. to pre-fund the acquisition of SABMiller plc (A3/Prime-2 on review direction uncertain).

The issuance of the Formosa bond follows $46 billion of bonds issued on Jan. 13, which were also rated provisional A3.

The acquisition is expected to close later in 2016.

All other ratings of Anheuser-Busch, including its A2 senior unsecured and Prime-1 short-term ratings, remain on review for downgrade. If the transaction goes through as expected, and assuming debt is pari passu, the company’s existing senior unsecured and short-term ratings will likely be downgraded to A3 and Prime-2, respectively.

Moody’s said the provisional A3 rating incorporates its assumption that the transaction will close as anticipated for about $108 billion, funded by a combination of debt and stock, and that the sale of SABMiller's joint venture stake in MillerCoors will close simultaneously.

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