Starbucks Corp.'s Senior Unsecured Notes Rated 'A'

NEW YORK (S&P Global Ratings) March 9, 2017--S&P Global Ratings assigned its 'A' issue-level rating to Starbucks Corp.'s proposed ¥85 billion ($750 million U.S. dollar equivalent) senior unsecured notes due 2024. We expect the company to issue the proposed notes under its shelf registration statement filed Sept. 15, 2016. We understand Starbucks will use the proceeds of the notes for sustainability projects such as coffee purchases from suppliers verified as complying with Starbucks' ethical sourcing program as well as the development and operation of farmer support centers in coffee growing regions. Pro forma for the proposed debt, adjusted debt to EBITDA will increase slightly to 1.4x but we expect deleveraging to occur from EBITDA growth. We do not expect the

...NEW YORK (S&P Global Ratings) March 9, 2017--S&P Global Ratings assigned its 'A' issue-level rating to Starbucks Corp.'s proposed Ñ85 billion ($750 million U.S. dollar equivalent) senior unsecured notes due 2024. We expect the company to issue the proposed notes under its shelf registration statement filed Sept. 15, 2016. We understand Starbucks will use the proceeds of the notes for sustainability projects such as coffee purchases from suppliers verified as complying with Starbucks' ethical sourcing program as well as the development and operation of farmer support centers in coffee growing regions. Pro forma for the proposed debt, adjusted debt to EBITDA will increase slightly to 1.4x but we expect deleveraging to occur from EBITDA growth. We do not expect the company to issue additional debt until leverage improves--dipping to the low-1x area. Starbucks' performance trends are solid, with persistent good same-store sales and profit gains as it promotes a sound cadence of new store openings...

Ratings Action