S&P Rates IMPT Credit 'B'-plus
Hello Scott,
Wouldn't be exercising DD without factoring knowables. Tho impt may ride the crest along with the host of others, this tempers enthusiasm for the long run. Argentine operations leveraged for the 2003 senior notes upstream guarantee, and the recent notes have no upstream guarantees.
May your rewards be commensurate with the risk.
Douglas
biz.yahoo.com
Monday February 7, 11:37 am Eastern Time
S&P affirms Impsat Fiber Networks ratings
( PRESS RELEASE PROVIDED BY STANDARD & POOR'S )
NEW YORK, Feb. 7 - Standard & Poor's today affirmed its single-'B'-plus corporate credit rating and its single-'B'
senior unsecured debt rating on Impsat Fiber Networks Inc. (Impsat).
The outlook is negative. At the same time, Standard & Poor's assigned its single-'B' rating to ImpSat's upcoming $200 million senior note expected to mature in 2005.
The affirmation follows the placement of a US$195 million IPO on Jan. 31, 2000 and the simultaneous contribution of US$48 million by British Telecommunications PLC.
The single-'B'-plus corporate credit ratings on Impsat already incorporated expectations that the company was going to be successful in placing an IPO early in 2000 and that the preferred-stock shareholders would convert their shares.
The IPO was considerably more successful than expected and represents a significant cash infusion that somewhat mitigates near-term credit concerns.
The rating on the company, however, also reflects its risky profile stemming from ImpSat's low profitability and weak debt-protection measures, the concentration of its activities in Latin America, its dependency on economic cycles, and increasing competition in its foreign markets.
These considerations are mitigated by the company's strong market share in Argentina and Colombia and its favorable demand prospects.
Impsat provides private-network, integrated data and voice telecommunications services in Argentina and Colombia (which, combined, represent 75% of revenues) and in Venezuela, Mexico, Ecuador, and Brazil.
ImpSat's $125 million 12.125% senior notes, due 2003, have an upstream guarantee from ImpSat S.A. (not rated), its Argentine subsidiary.
The upcoming senior notes [ been there - biz.yahoo.com ] and ImpSat's existing $225 million 12.375% senior notes, due 2008, do not have any upstream guarantees, and therefore are rated one notch lower than the corporate credit rating due to structural subordination
OUTLOOK: NEGATIVE
The additional equity from the IPO does improve the credit profile, but the challenges presented by some of Impsat's start-up operations and the sizable investments required to underwrite such nascent ventures still represent significant risks, Standard & Poor's said. |
