Fitch Rates Medco Health Solutions' Notes Offering 'BBB'

Business Wire, March 12, 2008

CHICAGO -- Fitch has assigned a 'BBB' rating to Medco Health Solutions' (NYSE:MHS) proposed senior unsecured notes offering, which are expected to be in two tranches due 2013 and 2018. The notes rank equally with the company's other senior unsecured debt.

The company intends to use the proceeds to refinance a portion of existing bank debt, fund a portion of share repurchases and other general corporate purposes. Given MHS' relatively strong operational and financial performance, Fitch expects the company's leverage (total debt/EBITDA) will range between 1.8 times (x) and 2.0x for FYE: 2008.

At Dec. 31, 2007, MHS had approximately $774 million in cash, $3.5 billion of debt ($500 million in unsecured notes, $600 million in receivables securitization and $2.4 billion in bank debt). At Dec. 31, 2007, the company had $587 million availability on its $2 billion revolving credit facility. For the latest 12 months (LTM) at Dec. 31, 2007, interest coverage (EBITDA/interest) was 21.1x, leverage (total debt/EBITDA) was 1.70x and cash flow from operations was $1.4 billion

Fitch's ratings for MHS are as follows:

--Issuer Default Rating (IDR) 'BBB';

--Senior unsecured credit facility 'BBB';

--Senior unsecured debt 'BBB'.

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.