Fitch dips Digicel

Fitch Ratings said it downgraded the long-term foreign currency issuer default ratings of all of the rated entities in the Digicel corporate structure, including: Digicel Group Ltd., to CC from CCC-, Digicel Group Two Ltd. to CC from CCC-; Digicel Group One Ltd. to CCC from B-; Digicel Ltd. to CCC from B-; and Digicel International Finance Ltd. to B- from B.

Fitch also downgraded Digicel Group Ltd.’s unsecured notes to C/RR5 from CC/RR5, Digicel Group Two’s unsecured notes to C/RR5 from CC/RR5; Digicel Ltd.’s unsecured notes to CCC/RR4 from B-/RR4, Digicel Group One’s unsecured notes to CCC/RR4 from B-/RR4, and Digicel International’s secured notes and credit facilities to B-/RR4 from B/RR4.

“Fitch expects that Digicel will have to restructure debt at multiple levels in the next 12-18 months, due to the group’s unsustainable capital structure and imminent refinancing risk,” said the agency in a press release.

The agency sees increasing interest expense to eat up most of the company’s declining income.

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