Fitch puts OTE on watch

Fitch Ratings said it placed Hellenic Telecommunications Organization SA's (OTE) BB long-term foreign-currency issuer default rating and OTE plc's BB senior rating on Rating Watch negative.

The Rating Watch negative reflects OTE's tight liquidity profile in the absence of a tangible refinancing plan for the company's upcoming maturities in 2013, the agency said.

The Rating Watch also reflects the risk of further contraction in the Greek economy in 2012 and 2013 coupled with the possibility of domestic competitive and regional regulatory pressures leading to knock-on effects on OTE's service revenue beyond those identified in Fitch's rating case, the agency said.

However, the agency noted that the company's 2011 revenue and EBITDA were better than Fitch's expectations amidst a difficult Greek economic environment.

OTE's net debt-to-EBITDA ratio, excluding short-term investments, was 2.54 times at year's end.

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