S&P: Telecom Argentina on positive watch

Standard & Poor's said it placed its ratings on Telecom Argentina SA (TECO) on CreditWatch with positive implications after it raised ratings on the Republic of Argentina to B from B-.

S&P noted that the ratings on TECO reflect the financial and regulatory challenges of operating in the Argentine environment and the exposure to currency-mismatch risks, given the high proportion of foreign-currency debt to be served with still-frozen and pesified revenues.

These factors are mitigated by the company's financial improvements after restructuring its financial debt in August 2005, its efficient operations and its good market position as one of the two incumbent telephone companies in Argentina, the agency added.

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