Moody's rates KT notes A3

Moody's Investors Service said it assigned an A3 rating to KT Corp.'s proposed $200 million senior unsecured notes due April 2012. Moody's also affirmed the company's A3 issuer rating.

The outlook is positive.

The proceeds of the notes issuance will be used to refinance the $200 million senior unsecured notes maturing in April 2007.

The rating continues to reflect KT's leading position in Korea's fixed-line telecommunications market and its substantial interest in KTF, the country's second-largest wireless operator, Moody's said. The rating also incorporates the company's sound financial profile with significant revenue and cash flow generating capabilities, the agency added.

The rating also reflects the potential constraints on growth given the high level of wireless penetration in South Korea and the ongoing need this creates to adopt new technologies, Moody's said. This situation may not only result in falling margins as technology becomes commoditized for the mass market, the agency said, but may also give rise to ongoing capital expenditure requirements.

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