Moody's may lower eircom

Moody's Investors Service said it placed all of the ratings of eircom Group plc on review for possible downgrade following the announcement that BCM Ireland Holdings Ltd. and certain of its affiliates and 35% owned by the eircom Employee Share Ownership Trust have launched a full offer for the company.

Ratings on review include the company's Ba2 corporate family rating at eircom Group plc, the Ba1 rating of Valentia Telecommunication Unlimited's €1.4 billion senior secured credit facilities, the Ba3 rating of Valentia Telecommunication Unlimited's €550 million unsecured notes due 2013 and the B1 rating of eircom Funding plc's senior subordinated notes due 2013.

The review for downgrade reflects Moody's expectation that the levels of debt at the company could materially increase due to the acquisition by BCM Ireland Holdings and that credit metrics could deteriorate as a result.

It also reflects Moody's view that a successful bid is likely given that this offer has been recommended by the eircom board, the agency noted.

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