Fitch puts Kabel on negative watch

Fitch Ratings said it placed Kabel Deutschland Vertrieb und Service GmbH's BBB+ long-term issuer default rating on Rating Watch Negative, in line with the rating action on its parent, Vodafone Group plc (A-/RWN).

Following its acquisition by Vodafone, Fitch rates Kabel using a top-down approach, at a notch lower than the parent's rating. Operating and strategic ties between the two companies are strong. Kabel gives Vodafone an opportunity to provide facilities-based wireline services in Germany, which complements its existing alternative fixed-line franchise and strong mobile positions in the country.

Following the acquisition, Vodafone issued a €2.15 billion intercompany loan to Kabel, in what Fitch said it views as evidence of tangible shareholder support.

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