Dublin, Ireland-based clinical research organization (CRO) ICON PLC plans to acquire U.S.-based PRA Health Science (PRAH), the fifth-largest CRO, for around $12 billion. The acquisition is expected to be funded with a mix of new debt, cash, and equity, and we assume the transaction will materially increase leverage from the positive net debt structure ICON currently holds. We are therefore placing our 'BBB-' long-term issuer credit rating on ICON on CreditWatch with negative Implications. The CreditWatch negative indicates the increased likelihood of a downgrade since the PRAH acquisition is likely to prompt a marked weakening in ICON's credit metrics to above our downside threshold for the current 'BBB-' rating of S&P Global Ratings-adjusted debt to EBITDA above 2x and funds
