S&P Places ON Semiconductor (ON) Ratings on Review for Downgrade

Standard & Poor's Ratings Services placed all ratings on ON Semiconductor Corp. (Nasdaq: ON), including the 'BB+' corporate credit rating, on CreditWatch with negative implications.

"The CreditWatch action follows ON's announcement today that it will acquire Fairchild Semiconductor International Inc. for an enterprise value of $2.3 billion," said Standard & Poor's credit analyst Christian Frank.

The company will use $2.4 billion of new term loan proceeds along with $300 million in cash to fund the transaction, refinance Fairchild's debt, and pay transaction fees. None of ON's existing debt will be repaid as part of this transaction, which we expect will close in the second quarter of 2016.

We will resolve the CreditWatch listing following our review of the business and financial impact of the transaction on ON's credit profile, likely within 90 days.

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