Moody’s might lift Yum! Brands

Moody's Investors Service said it placed the ratings of Yum! Brands, Inc. and KFC Holding Co. on review for upgrade, including Yum's Ba3 corporate family rating, Ba3-PD probability of default rating and B2 senior unsecured ratings.

Moody's also placed KFC's Ba1 rated senior secured bank debt and B1 senior unsecured ratings on review for upgrade.

In addition, Moody's affirmed Yum's SGL-1 speculative grade liquidity rating.

The agency said the review for upgrade reflects Yum's significant scale, geographic reach, brand diversity and franchise based business model which helps to add stability to revenues and earnings and reduces overall capital requirements.

“The review for upgrade will focus on Yum's commitment to its financial policy that will result in credit metrics that are either in-line with current levels or stronger on a sustained basis while prudently growing the breadth, depth and reach of its restaurant base and maintaining very good liquidity,” Bill Fahy, Moody's senior credit officer, said in a news release.

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