US Foods Inc. Ratings Raised On Deleveraging Forecast; Outlook Positive

US Foods Inc. (USF) is likely to execute on its deleveraging plan, and its financial sponsors have meaningfully reduced their ownership in the company since its IPO last summer, which should support continued focus on debt reduction. USF is seeking to reprice its $2.2 billion senior secured term loan, which will lower interest costs over our forecast horizon. We believe the foodservice distributor will apply free cash flow to deleverage to below 5x over the next 12 months and that its financial sponsors will continue to reduce control over the company. We are raising all of our ratings on USF, including our corporate credit rating to 'BB-' from 'B+'. The positive outlook reflects the potential for an upgrade if USF

...+ US Foods Inc. (USF) is likely to execute on its deleveraging plan, and its financial sponsors have meaningfully reduced their ownership in the company since its IPO last summer, which should support continued focus on debt reduction. + USF is seeking to reprice its $2.2 billion senior secured term loan, which will lower interest costs over our forecast horizon. + We believe the foodservice distributor will apply free cash flow to deleverage to below 5x over the next 12 months and that its financial sponsors will continue to reduce control over the company. + We are raising all of our ratings on USF, including our corporate credit rating to '##-' from 'B+'. + The positive outlook reflects the potential for an upgrade if USF further improves and commits to sustaining debt to EBITDA around or below 4.5x, which we think it could achieve if it prioritizes debt reduction over acquisitions and shareholder distributions. CHICAGO (S&P Global Ratings) Feb. 9, 2017--S&P Global Ratings said today...

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