Moody's rates Kyivstar notes B1

Moody's Investors Service said it today affirmed the ratings of Kyivstar GSM JSC following the company's announcement to issue $150.0 million in loan participation notes.

Concurrently, Moody's assigned a prospective B1 rating to Kyivstar's proposed note issuance. The outlook remains stable.

Moody's affirmed Kyivstar's B1 senior implied rating, issuer rating, $266.4 million loan participation notes due 2009, $75 million senior secured revolving credit facility and $40.5 million loan participation notes due November 2005 and prospective B1 rated $150 million new loan participation notes.

The funds received from the additional note issuance will be used to repay the remaining $40.5 million of the loan participation notes, as well as for capital expenditure and general corporate purposes.

Moody's said the rating on the proposed new notes takes into account that the terms and conditions of the proposed notes are similar to the notes issued in 2004.

The new rating also reflects Moody's expectation that debt ranking ahead of the notes will be maintained at a maximum of 15.0% of total debt, per the permitted liens test included in the proposed notes indenture.

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