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Moody’s upgrades Sprint, assigns ratings
Moody's Investors Service said it upgraded Sprint Corp.’s corporate family rating to B2 from B3 and probability of default rating to B2-PD from B3-PD based on Sprint's sustained operational performance and improved liquidity.
The agency also assigned Ba2 ratings to Sprint Communications, Inc.'s proposed $2 billion senior secured revolving credit facility due 2021 and $1.5 billion senior secured term loan B due 2024.
Proceeds from the term loan will be used for general corporate purposes.
In addition, Moody's upgraded the ratings of existing unsecured notes at Sprint, Sprint Communications and Sprint Capital Corp. to B3 from Caa1 and upgraded Clearwire Communications LLC's unsecured exchangeable notes to Ba3 from B1.
The agency affirmed the B1 rating for Sprint Communications’ junior guaranteed unsecured notes. These notes are not being upgraded in conjunction with the corporate family rating upgrade due to the increase in Sprint's senior liabilities, including the guarantee liability from Sprint's recent spectrum ABS notes issuance, which reduces the potential recovery on this debt class. Upon closing of the secured credit facility, Sprint Communications’ $200 million 9¼% debentures due 2022 will become secured, which is likely to result in an upgrade to Ba2, in line with the senior secured debt.
Furthermore, Moody's affirmed Sprint's speculative grade liquidity rating of SGL-3.
The outlook remains stable.
The corporate family rating and probability of default rating upgrades reflect Sprint's continued improvement in operations and improved liquidity position from its recent financing transactions, the agency said.
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