Fitch rates AT&T notes A

Fitch Ratings said it assigned an A rating to AT&T Inc.'s offering of £750 million 5.875% notes due 2017 and £1.1 billion 7% notes due 2040.

The outlook is stable.

Proceeds will be used for general corporate purposes.

The agency said AT&T's rating incorporates its expectations that, on a long-term basis, the company has the financial flexibility to maintain leverage in a range appropriate for the current rating category. For the last 12 months ended March 31, leverage approximated 1.7 times.

AT&T's ratings also reflect its diversified revenue mix, its significant size and economies of scale as the largest telecommunications operator in the United States as well as Fitch's expectation that AT&T will benefit from continued growth in wireless operating cash flows, the agency said.

Issues to watch regarding AT&T's ratings include the pressure of economic weakening on its lines of business during 2009 and competition in the consumer line of business, Fitch said.

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