Moody's cuts Alaska Communications, loans

Moody's Investors Service said it downgraded the ratings of Alaska Communications Systems Holdings, including the company's corporate family rating to B2 from B1, probability of default rating to B2-PD from B1-PD and senior secured term loan and senior secured revolver ratings to B1 from Ba3.

The speculative grade liquidity rating was upgraded to SGL-1 from SGL-3, indicating very good liquidity position. The outlook is stable.

Moody's said the downgrades are based on its belief that the company will remain highly leveraged despite using the majority of the proceeds from the closing of the Alaska Wireless Network transaction (a joint venture with GCI, Inc.) and most of its future modest levels of free cash flow for debt reduction.

While the company eliminated common stock dividends and is strongly focused on paying down debt, the agency said it anticipates that the projected dividends from the wireless joint venture (which it considers as EBITDA) and wireline EBITDA will not lead to a material reduction in leverage during the next two years.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.