S&P affirms Wind Telecomunicazioni

Standard & Poor's said it affirmed the BB- long-term corporate credit rating on Wind Telecomunicazioni SpA and the BB ratings on its senior secured and second-lien bonds as well as BB- ratings on the third-lien notes issued by Wind Acquisition Finance SA. The recovery ratings are unchanged at 2 on the secured debt and 4 on the subordinated debt.

The outlook is stable.

The affirmation follows Wind's consent solicitation asking senior unsecured noteholders to allow the company to issue €2.7 billion of new subordinated notes and to use the proceeds to repay the €2 billion payment-in-kind loan located at parent company Wind Acquisition Holdings Finance SpA and upstream €500 million to the holding company Weather Investments SpA.

The new notes would mature about 2017 and rank pari passu with the existing third-lien notes.

"The affirmation reflects the benefits we see for the group in getting rid of the complexity of the very large PIK loan and of the refinancing risk posed by this loan's maturity in December 2011," S&P analyst Leandro de Torres Zabala said in a statement.

The rating is constrained by the complex capital and shareholding structures of Wind and the wider Weather group, which heightens refinancing risk, the agency said.

The rating is supported by Wind's continued strong operating performance, of its solid good cash flow generation and of the limitations included in the debt documentation on Wind's ability to upstream cash to the Weather group, S&P said.

Pro forma for the proposed transaction, Wind's adjusted ratio of gross debt to 2008 EBITDA is expected to rise to about 5x from 4.7x.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.