S&P affirms iPCS, Horizon PCS

Standard & Poor's said it affirmed its ratings on iPCS Inc. (CCC+/developing/--) and Horizon PCS Inc. (CCC+/negative/--) following the companies' announcement that a definitive agreement has been signed under which Horizon PCS will merge with and into iPCS Inc.

After the completion of the merger, expected in the summer of 2005, the merged company's corporate credit rating will be CCC+, and S&P expects the outlook to be developing.

S&P said the rating on the merged company reflects its high business risk profile common to all Sprint PCS affiliates, its below-average EBITDA margin, negligible free cash flow, and potential for higher debt leverage in order to support next-generation evolution data only technology (EvDO). These factors are tempered somewhat by the improved relationship with Sprint PCS and the opportunity for growth given the company's relatively low 3.9% penetration rate. As a result of the merger, iPCS will be the third-largest Sprint PCS affiliate in terms of subscribers (432,000).

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.