Moody's could cut GCI, Inc.

Moody's Investors Service said it placed the ratings of GCI, Inc., including its B1 corporate family and probability of default ratings, on review for downgrade following the company's announcement that it plans to acquire $100 million of wireless assets from Alaska Communications Systems Holdings for cash.

In addition, GCI and Alaska Communications also announced the formation of a wireless joint venture in which GCI will own 66.7% and Alaska Communications the remaining 33.3%.

Moody's said the review was prompted by its concerns that the complexities associated with forming and running the wireless joint venture could lead to a deterioration in operational performance and a weakening of credit metrics.

The Alaskan wireless market is set to become much more competitive as Verizon Wireless is expected to enter the market later this year, the agency said.

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