Moody's: Sprint is unchanged on add-on

Moody's Investors Service said the B2 corporate family rating on Sprint Corp. and the Ba2 senior secured rating of Sprint Communications, Inc. are unchanged following its anticipated $400 million add-on to its existing $1.1 billion senior secured term loan B1 due in February 2024.

The proceeds will be used for general corporate purposes.

The agency said Sprint's ratings are on review for upgrade based on an assessment that the proposed combination with T-Mobile US, Inc. would materially improve Sprint's standalone credit profile.

On a pro forma combined basis, Sprint would benefit from reduced operating and capital investment costs, lower leverage approaching the low 4x range in two years, improved liquidity, greater operating scale and improved market positioning in the U.S. wireless industry, Moody's said.

The ratings reflect the company's high leverage of about 4.8x as of Dec. 31, 2018, intense competitive challenges and projected negative free cash flow through at least 2020, the agency said.

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