S&P: Valentia Telecommunications remains on watch

Standard & Poor's said it kept its BB+ long-term corporate credit and senior unsecured debt ratings on Valentia Telecommunications upc on CreditWatch with negative implications, where it was placed on Feb. 22.

The agency said that this follows an announcement by Valentia's owner, eircom Group plc, confirming that it has received an offer for the company from BCM Ireland Holdings Ltd.

S&P added that the CreditWatch placement reflects the expected weakening of Valentia's credit quality as a result of the takeover by BCM.

If the transaction completes broadly in line with preliminary indications, the new capital structure is expected to include debt of more than €3.8 billion, which amounts to a €1.4 billion increase from current levels, the agency said, adding that the resulting meaningful impact on Valentia's credit ratios would likely lead to a downgrade of more than one notch.

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