Moody's Investors Service comments that Company's current bond ratings are not immediately affected. The ultimate impact on the Company's existing bonds currently rated B1 will depend upon the final long-term capital structure and the Corporate Family Rating of CWI, the wholly-owned subsidiary that is ultimately expected to remain the rated obligor of the bonds.
Compared with the business of the other main operating subsidiary, Worldwide; CWI's holdings have stronger market positions with lower, albeit increasing, competitive pressures and more diversified business models. Therefore, Moody's believes the demerger could improve the business profile of the rated entity. However, Moody's notes that CWI expects to refinance its outstanding USD415 million bank facilities with USD1 billion of new bonds and bank facilities, leaving room for an increase in CWI's consolidated leverage. In order to assess the impact on the existing bond ratings, Moody's will seek to get clarity on CWI's future capital structure, including the terms and conditions of any new instruments; its future financial and strategic policies; its proportionate allocation of the pension deficit as well as the evolution of its operating performance and will comment further as details emerge.
Moody's believes that the issuance of GBP200 million convertible bonds at Cable & Wireless plc announced today is unlikely to have an impact on the creditworthiness of the existing bonds, even though the convertible bonds are to be issued by Cable & Wireless plc prior to the demerger. This is because the Company has publicly indicated that the purpose of this issuance is to fund and refinance the Worldwide business following the demerger, whereas the existing bonds are expected to be included in CWI's debt structure.
Cable & Wireless plc is one of the leading international communications companies. The company's principal operations are in Europe, Asia & US, the Caribbean, Panama, Macau, Monaco & the Islands. C&W operates through two stand-alone business units: Worldwide (previously EAUS) and CWI (previously Cable & Wireless International). In the first half of the fiscal year ended 31 March 2010, the company generated revenue of GBP1.9 billion and reported EBITDA before exceptional items of GBP463 million.
CWI is an integrated telecoms provider in most of its markets, providing services to homes, small and medium sized enterprises, corporate customers and governments. The company operates in 38 countries, grouped in 4 entities: The Caribbean, Panama, Macau, Monaco and The Islands. The Company is the market leader in 19 of the 26 markets in which it offers mobile services and 27 of the 34 markets in which it offers broadband. As of 30 September 2009 YTD, CWI accounted for approximately 39% of total revenue and 59% of the group's EBITDA.
Compared with the business of the other main operating subsidiary, Worldwide; CWI's holdings have stronger market positions with lower, albeit increasing, competitive pressures and more diversified business models. Therefore, Moody's believes the demerger could improve the business profile of the rated entity. However, Moody's notes that CWI expects to refinance its outstanding USD415 million bank facilities with USD1 billion of new bonds and bank facilities, leaving room for an increase in CWI's consolidated leverage. In order to assess the impact on the existing bond ratings, Moody's will seek to get clarity on CWI's future capital structure, including the terms and conditions of any new instruments; its future financial and strategic policies; its proportionate allocation of the pension deficit as well as the evolution of its operating performance and will comment further as details emerge.
Moody's believes that the issuance of GBP200 million convertible bonds at Cable & Wireless plc announced today is unlikely to have an impact on the creditworthiness of the existing bonds, even though the convertible bonds are to be issued by Cable & Wireless plc prior to the demerger. This is because the Company has publicly indicated that the purpose of this issuance is to fund and refinance the Worldwide business following the demerger, whereas the existing bonds are expected to be included in CWI's debt structure.
Cable & Wireless plc is one of the leading international communications companies. The company's principal operations are in Europe, Asia & US, the Caribbean, Panama, Macau, Monaco & the Islands. C&W operates through two stand-alone business units: Worldwide (previously EAUS) and CWI (previously Cable & Wireless International). In the first half of the fiscal year ended 31 March 2010, the company generated revenue of GBP1.9 billion and reported EBITDA before exceptional items of GBP463 million.
CWI is an integrated telecoms provider in most of its markets, providing services to homes, small and medium sized enterprises, corporate customers and governments. The company operates in 38 countries, grouped in 4 entities: The Caribbean, Panama, Macau, Monaco and The Islands. The Company is the market leader in 19 of the 26 markets in which it offers mobile services and 27 of the 34 markets in which it offers broadband. As of 30 September 2009 YTD, CWI accounted for approximately 39% of total revenue and 59% of the group's EBITDA.
No comments:
Post a Comment