Skilled Healthcare Group Inc., a Foothill Ranch-based nursing home operator, got its credit rating upgraded Monday by Moody’s Corp.
Moody’s said it upgraded Skilled to a “B1” corporate family rating from “B2” because it expects the company to generate more cash in the next year to 18 months.
The debt rater said it expects Skilled to use the cash to pay down its debt down.
In Moody’s rating system, anything less than “Baa” is considered junk, or less than investment-grade quality.
The rating agency also said it upgraded Skilled because it expects demand for long-term healthcare to remain stable.
Last week, Skilled said it planned to refinance about $375 million in debt coming due in 2012.
Skilled, which operates 100 nursing homes in California and other states, said it plans to take out a loan, credit line or combination of both to pay off its existing debt.
Skilled had about $3.5 million in cash and equivalents as of Dec. 31.