October 17, 2012 / 7:06 PM / 5 years ago

TEXT-Fitch expects rate UnitedHealth Group planned senior notes

Oct 17 - Fitch Ratings expects to assign an 'A-' rating to UnitedHealth
Group Inc.'s (UNH) proposed issue of senior unsecured notes. The 
rating on the planned issuance, which Fitch expects to be comprised of a mix of 
3-year, 5-year, 10-year, and 30-year maturities, is equivalent to the ratings on
UNH's existing senior unsecured notes.

A complete list of UNH's ratings follows at the end of this release.

Fitch's understanding is that UNH will use the proceeds of today's planned 
issuance to fund at least a portion of the first step of UNH's previously 
announced acquisition of Amil Participacoes S.A. (Amil), a Brazil-based managed 
care company.

Following UNH's Oct. 8, 2012 announcement of its plan to acquire Amil, Fitch 
affirmed the ratings on UNH's outstanding securities and its Insurer Financial 
Strength (IFS) ratings on various UNH operating company subsidiaries.  

As the first step of the Amil transaction, UNH will purchase approximately 60% 
of the outstanding Amil shares from controlling shareholders and management of 
Amil for approximately $3.2 billion in cash. The first step of the transaction 
is expected to take place in the fourth quarter of 2012, following Brazilian 
regulatory approval. 

UNH plans to conduct a tender offer for the approximate 30% of Amil's shares 
that are publicly owned in the first quarter of 2013, bringing the total 
expected value of the transaction of approximately $4.9 billion.

Fitch expects that UNH's post-acquisition run-rate interest coverage and 
financial leverage will remain supportive of the company's current ratings. 

Fitch currently rates UNH's entities as follows, with a Stable Rating Outlook:

 

UnitedHealth Group, Incorporated
--Long-term IDR 'A';
--Short-term IDR 'F1';
--Commercial paper rating 'F1';
--5.500% senior unsecured notes due 2012 'A-';
--4.875% senior unsecured notes due 2013 'A-';
--4.875% senior unsecured notes due 2013 'A-';
--4.75% senior unsecured notes due 2014 'A-';
--5% senior unsecured notes due 2014 'A-';
--4.875% senior unsecured notes due 2015 'A-';
--1.875% senior unsecured notes due 2016 'A-';
--5.375% senior unsecured notes due 2016 'A-';
--6% senior unsecured notes due 2017 'A-';
--6% senior unsecured notes due 2017 'A-';
--6% senior unsecured notes due 2018 'A-';
--3.875% senior unsecured notes due 2020 'A-';
--3.375% senior unsecured notes due 2021 'A-';
--4.7% senior unsecured notes due 2021 'A-';
--0% senior unsecured notes due 2022 'A-';
--2.875% senior unsecured notes due 2022 'A-';
--5.8% senior unsecured notes due 2036 'A-';
--6.5% senior unsecured notes due 2037 'A-';
--6.625% senior unsecured notes due 2037 'A-';
--6.875% senior unsecured notes due 2038 'A-';
--5.7% senior unsecured notes due 2040 'A-';
--5.95% senior unsecured notes due 2041 'A-';
--4.625% senior unsecured notes due 2041 'A-';
--4.375% senior unsecured notes due 2042 'A-'.

UnitedHealthcare Insurance Company 
UnitedHealthcare Insurance Company of Illinois 
UnitedHealthcare Insurance Company of New York
Sierra Health & Life Insurance Company, Inc.
Health Plan of Nevada, Inc.
UnitedHealthcare of Florida, Inc. 
PacifiCare of Arizona, Inc.
Oxford Health Insurance, Inc.
Oxford Health Plans of New York, Inc. 
UnitedHealthcare of Wisconsin, Inc
UnitedHealthcare Benefits of Texas, Inc.
UHC of California
PacifiCare Life & Health Insurance Company
UnitedHealthcare Plan of the River Valley
--IFS 'AA-'.

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