NEW YORK-Moody’s Investors Service Inc. confirmed Monday its speculative grade ratings, all in the `B’ range, on $1.4 billion of debt and preferred stock either outstanding or pending issue by Digital Equipment Corp. of Maynard, Mass.
The ratings confirmation, albeit with a negative ratings outlook, follows Digital Equipment’s announcement that it agreed to sell its semiconductor operations to Intel Corp. of Santa Clara, Calif., to end all outstanding litigation and to work with Intel on new products.
Federal government approval is required, and that process is expected to take up to six months.
The agreement includes the sale of Digital’s semiconductor manufacturing operations for about $700 million to Intel; the cross-licensing of patents for 10 years and Digital Equipment’s development of a full line of systems based on Intel’s IA-64 processors.
Digital Equipment said it will keep its Alpha and Alpha-related semiconductor design teams to develop future Alpha products, with Intel serving as a foundry for Digital’s Alpha processors, Moody’s said.
