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Starbucks’ legal battle with former business partner Kraft Foods appears to be a major factor in determining whether Moody’s Investors Service will upgrade its debt rating.

Moody’s said Tuesday it is considering an upgrade in light of Starbucks raising $750 million through a debt offering. The ratings firm said the coffee chain’s new liquidity, plus earnings and cash flow growth, would “help mitigate the financial liability related to the company’s binding arbitration with Kraft enough to support a higher rating.”

The arbitration is part of a long-running legal battle between the big food brands.

Starbucks walked away from their 12-year partnership in 2010, saying it no longer wanted Kraft to distribute its packaged coffees in grocery stores. It said the suburban Chicago company, whose brands include Maxwell House and Sanka, had not done enough to market its products.

Kraft disagreed, saying it increased Starbucks’ packaged-coffee sales from $50 million to about $500 million a year.

They entered arbitration in Chicago in summer 2012, but no decision has been issued. Kraft wants damages of as much as $2.9 billion. It says Starbucks offered $750 million in 2010 to avoid litigation.

Starbucks says that was before it looked into what it considers Kraft’s breaches of contract, and now it wants damages due to loss of sales of up to $62.9 million.

Moody’s currently rates Starbucks at Baa2 for senior secured debt, which is basically a moderate credit risk.

The coffee chain priced the notes Tuesday at 3.85 percent. They’re due in 2023.

The cash will be used for general corporate purposes, although Starbucks is already swimming in so much cash — it ended June with $1.4 billion — that it does not appear to need more.

Sometimes public companies, like consumers, borrow even when they are flush, in part to keep their creditworthiness updated.

Melissa Allison: 206-464-3312 or Twitter @AllisonSeattle.