Moody's ups LG Telecom outlook to positive

Moody's Investors Service said it changed the outlook of LG Telecom's Ba2 foreign currency corporate family and senior unsecured bond ratings to positive from stable.

The rating action is prompted by LG's strengthening operational and financial profile, as demonstrated by its ability to steadily grow its subscriber base in Korea's mobile number portability environment and by its improving operating margin, the agency said.

The ratings continue to reflect LG's expected revenue growth due to the addition of new and higher subscribers, an asymmetrical regulatory approach that favors the company, the close relationship with and potential support from its major shareholder, LG Corp., the continuing benefits of strong growth in demand for data and value-added services and LG's improved network quality and distribution channels, the agency said.

At the same time, S&P said the ratings reflect LG's position as a distant third in the Korean mobile telecoms market and its smaller subscriber base and lower brand recognition against the other two larger and financially stronger players: SKT (A2/stable) and KTF (unrated).

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