Moody's upgrades Shaw

Moody's Investors Service said it upgraded Shaw Communications Inc.'s corporate family and probability-of-default ratings to Ba1 from Ba2, senior unsecured note rating to Ba1 (LGD4, 51%) from Ba2 (LGD4, 57%) and senior subordinated preferred stock to Ba2 (LGD5, 95%) from B1 (LGD6, 96%).

The outlook is stable.

The upgrade was based upon Moody's expectation that improving operational performance will result in Shaw's debt-to-EBITDA ratio trending down toward 2.5x by 2009.

The agency said Shaw's Ba1 corporate family rating primarily reflects the strong business profile of its cable operation, including its industry-leading margin and internet penetration, and the successful early deployment of its telephony product.

The rating is constrained by Moody's longer-term concerns over the competitiveness of the direct-to-home satellite industry and Shaw's net governance weaknesses.

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