Danaher's (DHR) Acquisition of Cepheid is Credit-Negative Development - Moody's

September 6, 2016 11:34 AM EDT

Get the Pulse of the Market with StreetInsider.com's Pulse Picks. Get your Free Trial here.

Moody's Investors Service said that the planned $4 billion, debt-funded acquisition of Cepheid (NASDAQ: CPHD)(unrated) by Danaher Corporation (NYSE: DHR) is credit negative but its A2 rating is unaffected. For further information, please see www.moodys.com.

Moody's considers this acquisition a credit negative investment because of a very high purchase multiple funded entirely with debt. Its ratings and stable outlook of Danaher are unaffected because of Danaher's credit metrics and expected annual free cash flow of about $2.3 billion provide the ability to make large investments like this one that enhance its business profile. The company's strong track record of successfully integrating acquisitions is also supportive.

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

You May Also Be Interested In

Related Categories

Credit Ratings

Related Entities

Moody's Investors Service, Definitive Agreement

Add Your Comment