S&P rates Solventum, loans BBB-

S&P said it assigned BBB- ratings to Solventum Corp. and its $1.5 billion senior unsecured term loan (tranche A and B) and $2 billion revolving credit facility. The outlook is stable.

The company is expected to be spun off from 3M Co. in the first half of 2024.

“Our rating on Solventum reflects its large and well-diversified business, strong positions in stable markets, and meaningful materials science expertise supporting product differentiation. Solventum has significant scale (about $8.2 billion of revenue in 2023), large addressable markets, leading market positions in some business areas, solid product differentiation, and good product and geographic diversification,” S&P said in a press release.

The agency added, “In the next two years, we assume revenue will grow in the low-single-digit area, reflecting management's focus on the spin-off during the transition period. We believe growth will improve in the subsequent years due to its planned geographical and market expansion.”

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