Arrow Electronics Inc, Melville, New York has won an upgrade for its subordinated debt rating, which has been raised to Baa-3 from Ba3, as Moody’s Investors Service Inc expects the distributor to improve its results and debt protection measures. Moody’s expects the acquisitive Arrow to fund any additional expansion from internally generated cash flow and to maintain a prudent capital structure through the use of debt and new equity to fund any major acquisition. However, the new rating also reflects that competitive pressures, especially within the personal computer and semiconductor industries, will keep the company’s margins tight.
