Fitch to assign Millicom notes BB+

Fitch Ratings said it expects to rate Millicom International Cellular, SA's proposed $500 million senior unsecured notes due 2025 BB+(EXP).

Proceeds are expected to be used mainly to fully redeem the $311 million outstanding balance of the El Salvador notes, which were issued by Telemovil Finance Co., Ltd. and fully guaranteed by Telemovil El Salvador, SA, Millicom’s wholly owned subsidiary. The rest of the proceeds will be used for general corporate purposes and capex.

Fitch said the ratings reflect Millicom’s geographical diversification, effective marketing strategy and strong brand, and extensive network and distribution channels, all of which have contributed to its leading market positions in key markets, steady subscriber growth and solid pre-dividend free cash flow generation.

In addition, Millicom’s increasing investments in the under-penetrated fixed-line services bode well for its medium to long-term revenue growth, the agency said.

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