S&P cuts Windstream, debt

Standard & Poor's said it lowered its corporate credit rating on Windstream Holdings Inc. to B+ from BB-.

The outlook is stable.

At the same time, the agency downgraded its issue-level ratings on Windstream's senior secured debt to BB from BB+. The recovery rating remains 1, which indicates an expectation for very high (90%-100%) recovery in the event of payment default.

S&P also lowered the issue-level rating on the company's senior unsecured debt to B+ from BB-. The recovery rating remains 4, which indicates an expectation for average (30%-50%; upper half of the range) recovery in the event of payment default.

All ratings were removed from CreditWatch, where they were placed with negative implications on Aug. 6.

"Notwithstanding the company's recent announcement that it entered into an agreement to sell its data center assets for $575 million and use about $300 million of the proceeds to repay debt, the ratings downgrade reflects our view that Windstream faces a challenge to grow revenue and EBITDA longer term because of weak operating performance and competitive pressures in certain business segments," S&P credit analyst Allyn Arden said in a news release.

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