U.S.-based Church&Dwight Co. Inc. has agreed to purchase Water Pik Inc. for approximately $1 billion. We expect the transaction will be entirely debt-financed. We estimate pro forma leverage is about 2.5x and forecast leverage will be below 2x by fiscal year-end 2018. We are affirming all of our ratings on C&D, including our 'BBB+' corporate credit rating. The stable outlook reflects our expectation that the company will successfully integrate the acquisition and deleverage to below 2x over the next two years. In addition, we forecast the company will sustain good operating performance given its marketing capabilities. On July 17, 2017, S&P Global Ratings affirmed its 'BBB+' long-term corporate credit and unsecured debt issue ratings on Ewing, N.J.-based Church
