NEW YORK (AP) — Moody’s Investors Service on Thursday upgraded the corporate family debt rating on Del Monte Foods Co. by one notch within speculative territory, saying the company had built a sufficient cushion to support the higher rating.
The rating agency upgraded Del Monte’s family debt to “Ba2” from “Ba3,” putting it within two notches of investment grade. It said the upgrade reflects Del Monte’s “stable operating performance, improved capital structure and reducing financial leverage over the past year following the divestiture of its canned seafood business.”
The agency also noted that Del Monte’s cash flow is expected to be strong the next two years.
It assigned the lowest investment-grade rating, “Baa3,” to Del Monte’s proposed $1.1 billion in senior secured bank facilities, and it upgraded Del Monte’s speculative-grade liquidity rating to SGL-2 from SGL-3.