Fitch rates Everett SpinCo BBB+

Fitch Ratings said it assigned Hewlett-Packard Enterprise Co.’s wholly owned subsidiary, Everett SpinCo, Inc., a long-term issuer default rating, $1.05 billion senior unsecured note rating and $2 billion senior unsecured term loan ratings BBB+.

The ratings were assigned in anticipation of Everett's merger with Computer Sciences Corp. (CSC), which is targeted for April 1 pending the outcome of a March 27 shareholder vote.

The agency also upgraded the long-term ratings for Computer Sciences and its wholly owned subsidiary, CSC Computer Sciences UK Holdings Ltd., to BBB+ from BBB ahead of the merger. It affirmed the short-term ratings for Computer Sciences and CSC Capital Funding Ltd. at F2.

The outlooks on Everett, Computer Sciences and its wholly owned subsidiaries are stable.

The actions affect $10.4 billion of total debt, including an anticipated $3.7 billion five-year revolving credit facility.

Following consummation of the merger, Everett will change its name to DXC Technology Co. and Computer Sciences will merge with Everett's wholly owned subsidiary, Everett New Merger Sub Inc. with Computer Sciences as the surviving entity and remain a wholly-owned subsidiary of DXC.

Computer Sciences amended its credit facilities and certain other financing arrangements with lenders, which agreed to waive events of default arising as a result of the merger and replace Computer Sciences with DXC as borrower and guarantor under certain credit facilities and financing arrangements.

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