S&P gives BB+ to SoftBank notes

S&P said it assigned its BB+ issue credit rating to SoftBank Group Corp.'s (BB+/negative/--) two proposed senior unsecured U.S. dollar notes, each with different maturities, and its two proposed senior unsecured euro notes, each with different maturities.

The company plans to use proceeds of the offering to redeem U.S. dollar and euro notes issued in April 2013.

The issue rating on the proposed notes is equal to the long-term corporate credit rating on SoftBank. This is because the ratio of the issuer's total secured debt plus its subsidiaries' debt to the issuer's total debt (priority debt ratio) is below 50%, the threshold for us to consider notching down the issue rating.

“Our corporate credit rating on SoftBank reflects its stable profitability, supported by its strong market position as a diversified telecommunications operator in Japan, and its good business and geographic diversity,” S&P said in a news release.

“The negative rating outlook reflects our view that SoftBank has adopted an increasingly aggressive financial policy, as demonstrated by tolerance of accelerated investment in its fund business. As a result, we see a greater likelihood of key financial ratios for the company deteriorating more substantially than we had assumed.”

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