Moody's Rates Watson Note Offering As 'junk'

NEW YORK (AP) — Moody's Investors Service on Tuesday assigned a "junk" rating to Watson Pharmaceuticals Inc.'s $850 million offering of senior notes.

Moody's gave a Ba1 rating to the sale of five- and 10-year notes. That is one notch below an investment-grade rating. The service reiterated its Ba1 corporate rating for Watson, which carries a positive outlook.

Watson announced the offering on Tuesday, saying it will used the proceeds to finance its acquisition of Arrow Group and to pay down debt. In afternoon trading, Watson shares added 34 cents to $34.86.