S&P rates new Telenet Group notes CCC+

Standard & Poor's said it assigned its B+ corporate credit rating to Telenet Group Holding NV, the parent company of Belgium cable operator Telenet Communications NV, and assigned its CCC+ debt rating to the new offering of €245 million subordinated discount notes issued by Telenet Group Holding.

In addition, S&P said it affirmed its B- debt rating on Telenet Communications' senior unsecured notes issue maturing 2013, which has been increased to €500 million from €400 million. The B+ long-term corporate credit rating on Telenet was also affirmed.

The outlook is stable.

"The additional €100 million is intended either to be applied solely to the reduction of Telenet's existing bank loan debt or, alternatively, will be redeemed to bondholders at par. No specific maturities have been designated yet for the application of the additional amount," said S&P credit analyst Leandro de Torres Zabala. "The change in the amortization schedule and distribution of debt will not affect headroom under the covenants of the bank facility, which will be modified to this effect."

S&P said the ratings on Telenet reflect its position as a modestly sized and highly leveraged cable operator in Flanders, Belgium. Telenet operates an analog cable TV business, which generates stable and positive cash flows. It also operates smaller, but growing telephony and Internet operations that face strong competition from the incumbent Belgacom SA (AA/watch negative/A-1+), among others.

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