Moody’s rates Solventum Baa3

Moody's Investors Service said it assigned a first-time Baa3 issuer rating to Solventum Corp. The outlook is stable.

In connection with Solventum's spinoff from 3M Co., Solventum plans to issue debt and will use the proceeds to pay 3M a dividend.

“Solventum's Baa3 issuer rating reflects its significant global scale in offering medical, dental and life sciences products as well as health information systems. The company has very good product diversity and geographic diversity. The largest segment, medsurg, benefits from stable customer relationships and a broad portfolio of products incorporating 3M technology in areas like adhesives, films, and biomaterials.

“Financial leverage is supportive of an investment grade rating, and we anticipate a deleveraging focus over the next 12-18 months resulting in gross debt/EBITDA approaching 3.75x,” Moody’s said in a press release.

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