Moody’s: Hong Kong Telecommunications view to stable

Moody's Investors Service said it revised the outlook on Hong Kong Telecommunications Ltd.’s Baa2 issuer rating and the Baa2 senior unsecured rating on the notes issued by PCCW-HKT Capital No. 3-No.5 Ltd. to stable from negative.

The ratings were affirmed.

Hong Kong Telecommunications is a principal operating entity and a wholly owned subsidiary of HKT Ltd. (unrated), which is listed on the Stock Exchange of Hong Kong. Therefore, the agency – when considering Hong Kong Telecommunications' financial profile – assesses HKT Ltd.

Moody’s said the outlook change follows HKT Ltd.’s announcement on 22 July that it had successfully completed its rights issue and had raised about HK$7.9 billion (about $1 billion).

It also reflects the agency’s expectation that HKT Ltd. will use the net proceeds of the rights issue (HK$7.8 billion) to pay down a $2,425,000,000 (HK$18.9 billion) bridge loan by end July. The company has already refinanced about $1.4 billion (HK$11.1 billion) by five-year bank loans.

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