Moody's rates Clearwire notes B2, Caa2

Moody's Investors Service said it assigned a B2 rating to Clearwire Communications LLC's $175 million senior secured first-lien notes due 2015 and a Caa2 rating to its $500 million senior secured second-lien notes following the successful issuance.

The proceeds will be used for general corporate uses and network expansion.

The agency also said it upgraded Clearwire's existing $2.52 billion senior secured first-lien notes to B2 (LGD 2, 17%) from Caa1 as a result of the issuance of the second-lien and exchangeable notes, which are both junior and offer loss protection to the first-lien notes.

Clearwire's Caa1 corporate family rating and Caa2 probability of default rating remain under review because of the fluid situation regarding the company's ability to fund the full build-out of its business plan and its relationship with its key strategic partner, Moody's said.

The ratings reflect the company's early-stage operations, which are characterized by high capital investment and large operating losses, the agency said.

The rating is supported primarily by its deep and broad wireless spectrum holdings, which represent significant collateral, Moody's added.

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