S&P Global Ratings downgraded Owens & Minor Inc.'s corporate credit and issue-level ratings to BBB- from BBB and removed the ratings from CreditWatch, where they were placed with negative implications.

The outlook on the ratings is stable.

The rating cut comes following the Byram Healthcare deal, which S&P believes provides modest improvements to the company's scale, competitive position, EBITDA margins and growth profile through expanded capabilities to support the post-acute direct-to-consumer healthcare market, but these factors are more than offset by the material increase in debt leverage and exposure to Medicare reimbursement.

S&P said the stable outlook reflects its view that the company can achieve modest organic revenue growth, with stable-to-improving margins; generate good free cash flow; continue to pursue a moderate level of acquisitions; and maintain adjusted debt leverage of 2.5x to 3x over the next two years.

S&P Global Ratings and S&P Global Market Intelligence are owned by S&P Global Inc.