Perrigo Co. plc 'BBB-' Ratings Affirmed Following Divestiture Announcement; Outlook Stable

Leading over-the-counter (OTC) drug-maker Perrigo recently announced its intention to divest its prescription pharmaceutical business that makes up about one-quarter of its profit. The company has lowered its leverage to the mid-2x area by paying down debt in 2017 with the proceeds from the sale of Tysabri royalty rights, exceeding our expectations for deleveraging. We are affirming the 'BBB-' long-term issuer credit rating based on offsetting effects from expected lower diversity and scale following the anticipated divestment of the prescription pharmaceuticals business and lower-than-expected leverage. The stable outlook reflects our expectation that Perrigo will maintain its leadership position in the OTC business and its financial policy will dictate leverage in the 2x-3x range over the next two years. NEW YORK

...+ Leading over-the-counter (OTC) drug-maker Perrigo recently announced its intention to divest its prescription pharmaceutical business that makes up about one-quarter of its profit. + The company has lowered its leverage to the mid-2x area by paying down debt in 2017 with the proceeds from the sale of Tysabri royalty rights, exceeding our expectations for deleveraging. + We are affirming the '###-' long-term issuer credit rating based on offsetting effects from expected lower diversity and scale following the anticipated divestment of the prescription pharmaceuticals business and lower-than-expected leverage. + The stable outlook reflects our expectation that Perrigo will maintain its leadership position in the OTC business and its financial policy will dictate leverage in the 2x-3x range over the next two years. NEW YORK (S&P Global Ratings) Aug. 29, 2018--S&P Global Ratings today affirmed its '###-' long-term issuer credit rating on Perrigo PLC. The outlook is stable. At the same time,...

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