Fitch lowers Lumen

Fitch Ratings said it downgraded Lumen Technologies, Inc.'s and subsidiaries, Level 3 Parent, LLC's and Level 3 Financing, Inc.'s, long-term issuer default ratings to CCC- from B-. Fitch also lowered the issue-level ratings assigned to Lumen and Level 3 Financing, Inc., and the issue-level ratings at Qwest Capital Funding, Inc. and placed them on rating watch negative.

Additionally, Fitch trimmed the long-term IDRs for Qwest Corp., Qwest Communications International Inc., and Qwest Services Corp. to CCC+ from B-. Each of Lumen's rated subsidiaries was placed on RWN.

“The rating actions and negative watch reflect the increased event risks stemming from the company's disclosure of a transaction support agreement (TSA) for a comprehensive maturity extension transaction that Fitch believes could result in a distressed debt exchange (DDE) for the Lumen and Level 3 entities.

The ratings also reflect execution risks related to the company's ability to strengthen its operating profile. Fitch believes the combination of the large debt balance with weak operating results calls into question the long-term sustainability of the company's capital structure, even with extended maturities,” Fitch said in a press release.

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