Research Update: George Weston Ltd. Issuer Credit Rating Affirmed At 'BBB' With A Stable Outlook

On Sept. 4, 2018, Loblaw Cos. Ltd. announced its plan to spin out its 61.6% interest in Choice Properties Real Estate Investment Trust (Choice REIT) to its shareholders. At the same time, George Weston Ltd. (GWL; Loblaw's parent company) would give Loblaw's public shareholders GWL shares in exchange for their interest in Choice REIT. At the close of transaction, GWL will own direct controlling interests in Loblaw (about 50%) and Choice REIT (65.4%), while GWL's public ownership will be about 47%. Based on these transaction, our assessments of GWL's business and financial risk profiles are unchanged. We are also affirming our 'BBB' issuer credit rating on GWL. Our stable outlook reflects our expectation that GWL's consolidated debt-to-EBITDA would be unaffected

...+ On Sept. 4, 2018, Loblaw Cos. Ltd. announced its plan to spin out its 61.6% interest in Choice Properties Real Estate Investment Trust (Choice REIT) to its shareholders. At the same time, George Weston Ltd. (GWL; Loblaw's parent company) would give Loblaw's public shareholders GWL shares in exchange for their interest in Choice REIT. + At the close of transaction, GWL will own direct controlling interests in Loblaw (about 50%) and Choice REIT (65.4%), while GWL's public ownership will be about 47%. + Based on these transaction, our assessments of GWL's business and financial risk profiles are unchanged. We are also affirming our '###' issuer credit rating on GWL. + Our stable outlook reflects our expectation that GWL's consolidated debt-to-EBITDA would be unaffected and remain at 3.0x-3.5x through 2019....

Research Update