S&P applies AA- to Nike notes

S&P said it assigned its AA- issue-level rating to Nike Inc.'s proposed $1 billion senior unsecured notes due in 2026 and $500 million senior unsecured notes due in 2046.

The agency believes proceeds will be used for IT infrastructure improvements, such as investments in its direct-to-consumer platform to enhance consumer engagement and the ability to meet consumers' buy anywhere/anytime purchasing preferences. It also believes they will be used to support improvements to Nike’s global distribution network to more efficiently move increasing volume through its platform, general corporate purposes, and transaction fees and expenses.

Pro forma for the transactions, reported debt is about $3.55 billion.

S&P said the ratings reflect Nike’s leadership position in the global athletic footwear and apparel markets with revenue expected to approach $35 billion for the fiscal year ending May 2017.

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