OREANDA-NEWS. S&P Global Ratings today assigned its 'BBB' issue-level rating to Jacksonville, Fla.-based Fidelity National Information Services Inc.'s (FIS) announced senior unsecured notes offering. FIS will use the proceeds from the notes to repay existing debt balances.

The 'BBB' corporate credit rating on FIS remains unchanged. The ratings reflect the company's good competitive position and significant base of recurring revenues. The SunGard acquisition resulted in greater scale and product diversification, which further strengthen the company's business risk profile. Nevertheless, the sizable debt-funded transaction resulted in temporarily weaker credit measures with pro forma adjusted leverage in the high 3x area as of June 30, 2016. Over the coming year, we expect FIS to generate over $1 billion of free cash flow from low - to mid-single-digit organic revenue growth and full achievement of previously identified cost synergies. We also expect the company will apply much of its discretionary cash flow toward debt repayment. We could lower the rating if weaker-than-anticipated operating performance or aggressive financial policies result in leverage sustained above 3x. For the full corporate credit rating rationale, see our research update published Aug. 12, 2015 on RatingsDirect.