Moody's introduces new ratings

Moody's Investors Service has introduced two new ratings: probability-of-default ratings and loss-given-default ratings.

The agency's current long-term credit ratings are opinions about expected credit loss that incorporate both the likelihood of default and the expected loss in the event of default. The loss-given-default rating methodology will disaggregate these two key assessments in long-term ratings. The agency said the methodology will also enhance the consistency in its notching practices across industries and will improve the transparency and accuracy of its ratings, as Moody's research shows that credit losses on bank loans have tended to be lower than those for similarly rated bonds.

Probability-of-default ratings are assigned only to issuers, not specific debt instruments, and use the standard Moody's alpha-numeric scale. They express Moody's opinion of the likelihood that any entity within a corporate family will default on any of its debt obligations.

Loss-given-default assessments (or LGDs) are assigned to individual rated debt issues - loans, bonds and preferred stock - and express Moody's opinion of expected loss as a percent of principal and accrued interest at the resolution of the default, with assessments ranging from LGD1 (loss anticipated to be 0%-9%) to LGD6 (loss anticipated to be 90%-100%).

Below is a list of the rating actions for Moody's rated companies, sorted by industry. The rating immediately after the company name denotes the corporate family rating and the percentages next to the LGDs represent the expected loss-given-default rates.

North American telecommunications

Alaska Communications Systems Holdings Inc., B1; probability-of-default rating, B1; revolver and term loan facility, B1, LGD 3, 49%.

Broadview Networks Holdings, Inc., B3; probability-of-default rating, B3; notes, B3, LGD3, 47%.

Centennial Communications Corp., B2; probability-of-default rating, B2; notes, upgraded to Caa1 from Caa2, LGD 5, 89%. Centennial Cellular Operating Co. LLC, revolver and term loan, upgraded to Ba2 from B1, LGD 2, 10%; senior notes, upgraded to B2 from B3, LGD 3, 49%; subordinated notes, upgraded to B3 from Caa1, LGD 5 , 77%.

Cincinnati Bell Inc., Ba3; probability-of-default rating, Ba3; revolver term loan and senior secured notes, upgraded to Ba2 from Ba3, LGD3, 34%; senior unsecured notes, upgraded to Ba3 from B1, LGD4, 50%; senior subordinated notes, upgraded to B2 from B3, LGD5, 89%; convertible preferreds, upgraded to B2 from Caa1, LGD6, 98%. Cincinnati Bell Telephone Co., notes, upgraded to Baa3 from Ba2, LGD2, 12%.

Cleveland Unlimited, Inc., Caa1; probability-of-default rating, B3; notes, Caa1, LGD 4, 60%.

Consolidated Communications Holdings, Inc., B1; probability-of-default rating, B1; notes, B3, LGD6, 91%. Consolidated Communication Acquisition TX and Consolidated Communications, Inc., revolver and term loan, upgraded to Ba3 from B1, LGD3, 38%.

Digicel Ltd., B1; probability-of-default rating, B1; notes, B3, LGD 5, 79%.

Dobson Communications Corp., B3; probability-of-default rating, B3; senior notes, floating-rate senior notes and convertible debentures, Caa2, LGD 5, 89%. Dobson Cellular Systems, Inc., revolver, Ba3, LGD 1, 0%; first-priority notes, upgraded to Ba3 from B1, LGD 1, 9%; second-priority notes, upgraded to B1 from B2, LGD 2, 29%. American Cellular Corp., revolver and term loans, upgraded to Ba3 from B1, LGD 1, 9%; notes, B3, LGD 4, 58%.

Eschelon Telecom, Inc., B3; probability-of-default rating, B2; notes, B3, LGD4, 64%.

GCI, Inc., Ba3; probability-of-default rating, Ba3; notes, upgraded to B1 from B2, LGD 5, 74%.

Hawaiian Telcom Communications, Inc., B1; probability-of-default rating, B1; loans, upgraded to Ba3 from B1, LGD3, 30%; senior notes, B3, LGD5, 80%; senior subordinated notes, upgraded to B3 from Caa1, LGD6, 94%.

iPCS, Inc., B3; probability-of-default rating, B2. Horizon PCS Escrow Co., notes, B3, LGD4, 68%. iPCS, Inc. Escrow Co., notes, B3, LGD4, 68%.

Level 3 Communications Inc., Caa1; probability-of-default rating, Caa1; senior notes and senior convertible notes, upgraded to Caa2 from Caa3, LGD4, 67%; subordinated convertible notes, upgraded to Caa3 from Ca, LGD6, 94%. Level 3 Financing, Inc., convertible notes, upgraded to Caa2 from Caa3, LGD4, 67%; term loan, upgraded to B1 from B2, LGD1, 3%; notes, upgraded to B2 from B3, LGD2, 28%.

Nextel Partners, Inc., Ba2; probability-of-default rating, Ba1; notes, Ba3, LGD5, 80%.

Primus Telecommunications Group, Inc., Caa1; probability-of-default rating, Caa1. Primus Telecommunications Group, Inc., notes, Caa3, LGD5, 86%. Primus Telecommunications Holdings, Inc., term loan, B3, LGD3, 37%; notes, Caa1, LGD3, 45%.

Qwest Communications International Inc., B1; probability-of-default rating, B1; revolver, downgraded to B3 from B1, LGD4, 69%; senior notes due 2008 and convertible senior notes due 2025, B3, LGD5, 80%; senior notes due 2011, senior notes due 2014 and floating-rate notes due 2009, B2, LGD4, 69%. Qwest Services Corp., subordinated notes, B3, LGD5, 80%. Qwest Corp., term loan and notes, upgraded to Ba2 from Ba3, , LGD2, 26%. Qwest Capital Funding Corp., notes, B3, LGD5, 89%.

Qwest Communications International Inc., B1; probability-of-default rating, B1; revolver, downgraded to B3 from B1, LGD4, 69%; senior notes due 2008 and convertible senior notes due 2025, B3, LGD5, 80%; senior notes due 2011, senior notes due 2014 and floating-rate notes due 2009, B2, LGD4, 69%. Qwest Services Corp., subordinated notes, B3, LGD5, 80%. Qwest Corp., term loan and notes, upgraded to Ba2 from Ba3, , LGD2, 26%. Qwest Capital Funding Corp., notes, B3, LGD5, 89%. Mountain States Telephone & Telegraph Co., debentures, upgraded to Ba2 from Ba3, LGD 2, 26%. Northwestern Bell Telephone Co., debentures, upgraded to Ba2 from Ba3, LGD 2, 26%.

Rogers Communications Inc., Ba2; probability-of-default rating, Ba2. Rogers Wireless Inc., senior secured notes, Ba2, LGD3, 43%; senior subordinated global notes, downgraded to B1 from Ba3, LGD6, 91%. Rogers Cable Inc., notes and second-priority notes, Ba2, LGD3, 43%.

Rural Cellular Corp., B3; probability-of-default rating, B3; revolver, upgraded to Ba3 from B1, LGD1, 0%; senior notes, upgraded to Ba3, B2, LGD2, 18%; senior subordinated notes, Caa2, LGD5, 86%; exchangeable preferred stock, upgraded to Caa2 from Ca, LGD6, 98%; junior exchangeable preferred stock, upgraded to Caa2 from C, LGD6, 100%.

Securus Technologies, Inc., B3; probability-of-default rating, B3; notes, upgraded to B2 from B3, LGD3, 41%.

Suncom Wireless, Inc., Caa3; probability-of-default rating, Caa3; term loan, B2, LGD1, 3%; senior notes, Caa2, LGD3, 37%; subordinated notes, Ca, LGD5, 83%.

Ubiquitel Operating Co., B3; probability-of-default rating, B2; notes, upgraded to B3 from Caa1, LGD4, 66%.

Windstream Corp., Ba2; probability-of-default rating, Ba2; revolver and term loans, upgraded to Ba1 from Ba2, LGD2, 25%; notes, Ba3, LGD5, 80%. Windstream Holdings Co. of the Midwest, notes, upgraded to Ba1 from Ba2, LGD2, 25%. Windstream Georgia Communications Co., notes, Baa2, LGD1, 0%.

US LEC Corp., Caa1; probability-of-default rating, Caa1; notes, downgraded to Caa1 from B3, LGD4, 50%.

Valor Telecommunications Enterprise, LLC, notes, upgraded to Ba1 from Ba2, LGD2, 25%.

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