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Del Monte's note offering rated BB minus

CHICAGO, Jan. 26 (UPI) -- Fitch Ratings of Chicago Wednesday assigned a BB minus rating to Del Monte Foods new $250 million 6 3/4 percent privately placed senior subordinated notes.

The notes are due Feb. 15, 2015.

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Proceeds from Del Monte's $250 million senior subordinated debt issuance will be used to partially fund the repurchase of its 9 1/4 percent senior subordinated notes due 2011.

The newly issued unsecured notes will rank equally with all of Del Monte's other unsecured senior subordinated indebtedness.

The notes will be guaranteed on a subordinated basis by Del Monte Foods Co. and on a senior subordinated basis by certain of Del Monte's direct and indirect U.S. subsidiaries.

Fitch expects the reduction in Del Monte's average total debt over time and more favorable pricing on the newly issued senior subordinated notes and pending secured credit facility to cut yearly interest costs.

Terms of Del Monte's pending new credit facility are anticipated to be less restrictive than the company's existing credit facility.

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