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McDonald’s Joins Firms Irking Bondholders for Equity’s Sake

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McDonald’s Corp. joined the ranks of companies drawing the ire of bondholders and the attention of ratings companies after it said it plans to accelerate shareholder rewards, which may increase its debt burden.

The burger chain’s Monday statement that it would return as much as $9 billion to shareholders this year resulted in a reduction of its credit rating at Standard & Poor’s. The plan “will necessitate higher leverage than we forecast and represents a more aggressive shift toward shareholder returns that we previously assumed,” analysts led by Robert Schulz in New York said in cutting the company’s rating to A- from A. Moody’s Investors Service put its A2 rating on review for a ratings cut.