Moody's upgrades OTE

Moody's Investors Service said it upgraded Hellenic Telecommunications Organization SA's ("OTE") corporate family rating to B2 from Caa1, its probability of default rating to B2-PD from Caa2-PD and the global bonds issued by OTE plc to B2 from Caa1. The outlook remains stable.

This rating action follows Moody's recent decision to upgrade Greece's government bond rating to Caa3 from C and the foreign-currency sovereign ceiling to B3 from Caa2.

"OTE remains a predominantly Greek business, headquartered in Athens and with approximately 75% of its revenues in Greece. Its ratings therefore remain to some extent constrained both by Greece's government bond rating and the sovereign ceiling, and therefore we have upgraded the company's ratings following the recent upgrade of that of Greece," Carlos Winzer, a Moody's senior vice president, said in an agency news release.

OTE's B2 corporate family rating reflects the company's underlying business risk given that it operates in a very challenging market, the agency said

In Moody's view, the rating is supported by the company's strong market positions in both domestic fixed-line and mobile services, a modest degree of international diversification, the quality of its management and the ongoing implicit support from Deutsche Telekom.

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