Moody's rates Ingles bonds B1

Moody's Investors Service said it assigned a B1 rating (LGD5, 76%) to the $500 million senior unsecured notes issued by Ingles Markets, Inc.

The agency affirmed Ingles' Ba3 corporate family and probability-of-default ratings.

The outlook is stable.

According to Moody's, the new senior notes will be used to tender for the $350 million senior subordinated notes due 2011, to repay certain upcoming mortgage debt maturities and to pay down existing revolver loans. If the offering is upsized, proceeds will be used supplement cash balances.

The affirmation reflects Ingles' solid regional franchise, improvement in its debt maturity profile and replacement of existing bilateral lines of credit with a new three year $175 million syndicated revolving credit facility, the agency said.

The affirmation also considers the likelihood that Ingles' credit metrics will modestly deteriorate in 2009, Moody's noted.

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