Fitch assigns Axtel notes B+/RR3

Fitch Ratings said it assigned a B+/RR3 rating to Axtel SAB de CV's $146 million reopening of its senior secured notes due 2020.

In exchange for the company's existing 2017 and 2019 senior unsecured notes, $110 million in senior secured notes will be offered, and an additional $36 million in new senior secured notes due 2020 will be issued.

With the proposed reopening, the 2020 notes will have outstanding roughly $417 million, with $397 million in senior secured notes and the remainder of senior convertible notes. These notes are secured by first-priority liens on all capital stock of subsidiary guarantors and substantially all assets.

Fitch said Axtel's ratings reflect a better liquidity position after the debt exchange that took place in January 2013, which resulted in lower leverage and a capital structure with more flexibility to service debt and an extended maturity profile.

In addition, the liquidity position was enhanced by the sale and lease back of 883 of towers, which proceeds, roughly $250 million, were used to cover the costs of debt exchange, prepayment of the syndicated loan and company's cash balance, the agency said. While the sale and leaseback of towers improved the liquidity position, leverage adjusted for off-balance sheet liabilities remain relatively the same.

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