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Technology Stocks : Loral Space & Communications
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To: Joe Brown who wrote (5093)1/5/1999 11:56:00 AM
From: jopawa  Read Replies (1) of 10852
 
Here's the text from Bloomberg.

Mexico's SatMex Outlook Downgraded to Negative by Moody's


Mexico City, Jan. 4 (Bloomberg) -- Satelites Mexicanos SA had its credit rating outlook downgraded to negative by Moody's Investor Services on concern over slow revenue growth and the risk of a currency devaluation this year in Mexico.

Moody's assigned a B1 rating to the company's $325 million senior secured five-year floating rate notes, which refinanced two secured loans last December that were also rated B1.

SatMex, a joint venture between Loral Space & Communications and Telefonica Autrey SA, depends on Grupo Televisa SA, Mexico's biggest broadcaster, for a third of its revenue and this contract may not be renewed in 1999 because Televisa has strong ties with another satellite company called PanAmSat Corporation, based in the U.S.

The Mexican government sold off the satellite system in 1997, with Loral taking a 49-percent stake and Autrey 26 percent with the government keeping the other 25 percent.

As a privately held company SatMex does not release financial reports, which only potential investors and Moody's analysts have access to. Moody's says SatMex has shown disappointing revenue growth and the outlook is bleak given an expected slow down in economic growth in 1999.

There is also concern the Mexican peso may come under pressure and slide against the dollar, which would make it harder for the company to service its dollar debt and make it harder for the company's customers to pay their bills, said Moody's.




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