Moody's may up Western Wireless, affirms Alltel

Moody's Investors Service said it affirmed the long- and short-term ratings of Alltel Corp. and its subsidiaries. At the same time, Moody's placed the ratings of Western Wireless Corp. on review for possible upgrade.

Moody's affirmed Alltel's A2 senior unsecured and issuer ratings, prospective A2 senior unsecured shelf rating and P-1 commercial paper rating, Alltel Communications Holdings Co. of the Midwest Inc.'s, 360(degree) Communications Co.'s and Alltel Ohio LP's A2 senior unsecured issuer rating and Alltel Georgia Communications Corp.'s A3 senior unsecured rating.

On review are Western Wireless' B2 senior implied and senior bank credit facility ratings and Caa1 senior unsecured and issuer ratings.

On Jan. 10, Alltel announced its intentions to acquire Western Wireless for about $4.0 billion in stock and cash, plus the assumption of about $2.0 billion in debt. The outlook is stable.

The affirmation of Alltel's ratings is based upon Moody's expectation that Alltel will finance the $6 billion purchase price with at least 50% equity, substantial liquidity, that wireless operations will generate steadily increasing cash flows and Alltel's wireline operations will remain a significant source of free cash flows.

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