S&P rates Pontis III notes exchangeable for Globo BBB+

Standard & Poor’s said it assigned its BBB+ foreign-currency issue-level rating to Pontis III Ltd.'s senior secured exchangeable notes. S&P also kept its BBB+ rating on Globo Comunicacao e Participacoes SA’s (Globo; BBB+/stable/--) perpetual notes unchanged.

The Pontis III notes will be mandatorily exchangeable for Globo’s perpetual notes.

S&P said its rating on the proposed senior notes reflects the credit rating on Globo because by July 20, 2015, the Pontis III senior notes will be exchanged for Globo’s perpetual notes, which the latter will convert into 10-year bonds due 2025.

“Even though Pontis III isn't related to Globo – and the latter doesn't guarantee these proposed notes – we understand that investors in the senior notes will eventually become creditors of Globo, given the mandatory exchange clause in the senior notes' indenture,” S&P said in a news release.

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