Moody's rates Hawaiian Telcom loan B1

Moody's Investors Service said it assigned a B1 (LGD3, 36%) rating to Hawaiian Telcom Communications, Inc.'s proposed new senior secured term loan. The outlook remains stable.

The proceeds of the term loan will be used to refinance and extend the maturity of the existing $300 million term loan due 2017.

The agency said Hawaiian Telcom's B1 corporate family rating reflects its diverse base of recurring revenues, healthy market share, modest leverage and adequate cash flows.

In the agency's view, these positives are offset by the company's relatively small scale, the tough competition from the incumbent cable operator and the long-term challenges associated with wireless substitution.

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