Fitch Affirms CareFusion at 'BBB'; Withdraws All Ratings

Fitch Ratings has affirmed the ratings of CareFusion Corp. (CareFusion) at 'BBB' following its acquisition by Becton Dickinson & Co. (NYSE: BDX). The Positive Rating Watch is removed and a Stable Rating Outlook is assigned.

Fitch's ratings on CareFusion have simultaneously been withdrawn for business reasons. Fitch reserves the right in its sole discretion to withdraw or maintain any rating at any time for any reason it deems sufficient.

The following ratings of CareFusion have been removed from Rating Watch Positive, affirmed, and withdrawn:

--Long-term Issuer Default Rating (IDR) at 'BBB';

--Senior unsecured bank facility at 'BBB';

--Senior unsecured notes at 'BBB'.

The Rating Outlook is Stable. The above rating actions apply to approximately $2 billion of debt outstanding at Dec. 31, 2014.

KEY RATING DRIVERS

-- The combination of BDX and CareFusion has strong strategic rationale. The firms' product portfolios are complementary and industry-leading, particularly among medication management products, with little direct overlap.

-- Management at BDX has said publicly that it intends to suspend its share repurchase program and has stated a gross debt/EBITDA target of 2.5x. However, Fitch is currently uncertain of BDX's capital structure management and M&A strategy going forward.

-- Fitch expects the solid and stable cash flow profile of the combined firm to adequately facilitate achievement of management's 2.5x gross debt/EBITDA target post-deal. Pro forma debt leverage will exceed 4x, meaningfully higher than pre-merger levels at either standalone firm.

-- Both standalone firms have stable organic growth profiles and stable operations. Opportunities to grow the CFN business in non-U.S. markets should further support growth and margins over the medium-to-longer term.

Business Relationship Management: Anna Laudon, New York, Tel: +1-212-908-0715, Email: anna.laudon@fitchratings.com

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria and Related Research:

--'Corporate Rating Methodology' (May 28, 2014);

--'Fitch Places CareFusion's Ratings on Positive Watch on Acquisition by Becton Dickinson' (Oct. 6, 2014);

--'Fitch Affirms CareFusion at 'BBB'; Outlook Stable' (Aug. 21, 2014).

Applicable Criteria and Related Research:

Corporate Rating Methodology - Including Short-Term Ratings and Parent and Subsidiary Linkage

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=749393

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=981538

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