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Press release from Business Wire

A.M. Best Assigns Debt Ratings to WellPoint, Inc.'s New Senior Unsecured Notes

Thursday, September 06, 2012

A.M. Best Assigns Debt Ratings to WellPoint, Inc.'s New Senior Unsecured Notes15:52 EDT Thursday, September 06, 2012 OLDWICK, N.J. (Business Wire) -- A.M. Best Co. has assigned debt ratings of “bbb+” to the $625 million 1.25% senior unsecured notes due 2015, $625 million 1.875% senior unsecured notes due 2018, $1.0 billion 3.30% senior unsecured notes due 2023 and $1.0 billion 4.65% senior unsecured notes due 2043 recently issued by WellPoint, Inc. (WellPoint) (Indianapolis, IN) [NYSE: WLP]. Concurrently, the ratings have been placed under review with negative implications, which is consistent with the under review status of the existing ratings of WellPoint and its insurance subsidiaries. (See A.M. Best's press release dated July 10, 2012 for further information.) The proceeds from the securities represent a good portion of the financing for the previously announced $4.9 billion acquisition of AMERIGROUP Corporation (Amerigroup). Although WellPoint's pro forma financial leverage—as well as its goodwill and intangibles to equity—is somewhat higher than similarly-rated peers, A.M. Best views favorably the low cost of capital and the laddering of maturities within WellPoint's capital structure. The acquisition is expected to close by year-end 2012, subject to state and federal regulatory approvals. The ratings are anticipated to remain under review pending the completion of the transaction and A.M. Best's continuing discussions with WellPoint's management. However, A.M. Best will continue to monitor WellPoint's operating performance, risk-based capitalization at the operating companies and its capital structure to ensure financial and operating metrics remain within A.M. Best's expectations. The methodology used in determining these ratings is Best's Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best's rating process and contains the different rating criteria employed in the rating process. Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology. Founded in 1899, A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com. Copyright © 2012 by A.M. Best Company, Inc.ALL RIGHTS RESERVED.A.M. Best Co.Bridget Maehr, 908-439-2200, ext. 5321Senior Financial Analystbridget.maehr@ambest.comorAndrew Edelsberg, 908-439-2200, ext. 5182Vice Presidentandrew.edelsberg@ambest.comorRachelle Morrow, 908-439-2200, ext. 5378Senior Manager, Public Relationsrachelle.morrow@ambest.comorJim Peavy, 908-439-2200, ext. 5644Assistant Vice President, Public Relationsjames.peavy@ambest.com