Moody's rates ONO notes Caa2

Moody's Investors Service said it assigned a provisional Caa2 rating to the €460 million of senior notes due in 2019 to be issued by ONO Finance II plc. ONO's B3 corporate family rating remains unchanged.

The outlook is positive.

ONO intends to use the proceeds from this issuance to pre-pay in full its €180 million of 10.5% senior notes and €270 million of 8% senior notes, and to repay its €10 million Fond-ICO participative loan upon maturity in May 2011.

The rating reflects the substantial amount of priority debt in the company's capital structure, Moody's said. However, a successful issuance of the notes will extend ONO's debt maturity profile and remove the market risk from the most junior portion of debt in the company's capital structure.

The ratings also consider the notes guarantee on a senior subordinated basis by Cableuropa and on a senior basis by ONOMidco, Moody's said.

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