Moody's rates Jones Apparel notes Ba3

Moody's Investors Service said it assigned a Ba3 rating to Jones Apparel Group, Inc.'s proposed $250 million new senior unsecured notes due 2018. The agency said it affirmed its corporate family rating at Ba2, probability of default rating at Ba2, speculative grade liquidity rating at SGL-1, $250 million senior unsecured notes due 2014 at Ba3 (to LGD4, 68% from LGD5, 72%) and $250 million senior unsecured notes due 2034 at Ba3 (to LGD4, 68% from LGD5, 72%).

The outlook is stable.

Proceeds from the new notes will be used to fund the acquisition of a 55% interest in Stuart Weitzman Holdings LLC.

The affirmation reflects a view that the acquisition of Stuart Weitzman will be highly complementary to Jones' existing brand portfolio and will widen the company's distribution breadth, with higher penetration in higher end sales channels, Moody's said.

The agency said it believes Jones will be able to maintain appropriate metrics for its current rating.

The stable outlook acknowledges the moderate level of integration risk in this acquisition, the agency added.

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