S&P rates HKT Capital notes BBB

S&P said it assigned a BBB long-term issue rating and cnA long-term Greater China regional scale rating to a proposed issue of dollar-denominated senior unsecured notes by HKT Capital No. 4 Ltd., a wholly owned subsidiary of Hong Kong Telecommunications (HKT) Ltd.

HKT, along with its parent HKT Group Holdings Ltd., will irrevocably and unconditionally guarantee the notes on an unsubordinated and unsecured basis, the agency said.

The proceeds will be used to refinance the company’s existing debt and for general corporate purposes, S&P said.

When assessing HKT's credit profile, the agency said it takes a consolidated view of HKT Trust and HKT Ltd., which owns 100% of HKT Group Holdings.

HKT Trust's business risk profile reflects the company's market leadership in fixed-line communications, broadband and mobile services, in addition to its unique quadruple-product offering that benefits from the media businesses of PCCW Ltd., the parent of HKT Trust, S&P said.

The highly competitive and mature telecom industry in Hong Kong tempers these strengths, the agency said.

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