Moody's upgrades WTT notes

Moody's Investors Service said it upgraded the rating on WTT Investment Ltd.'s senior unsecured notes rating to Ba2 from Ba3.

The notes were assumed by HKBN Ltd.'s Metropolitan Light Co. Ltd.

The outlook was changed to stable from positive.

Moody's also withdrew WTT HK Ltd.'s Ba3 corporate family rating with a positive outlook.

The upgrades reflect the full assumption of bond obligations by HKBN and the extension of unconditional guarantees by HKBN's key subsidiaries to the WTT notes, Moody's said.

HKBN Group Ltd. and key operating subsidiary, Hong Kong Broadband Network Ltd., also unconditionally guarantees the notes.

These developments mean that the expected loss prospect on the WTT notes is now on par with existing HKBN debt, Moody's said.

The ratings reflect HKBN's solid business profile as the second largest telecommunications service provider in Hong Kong in the fixed-line segment by revenue, geographic concentration in Hong Kong and modest scale when compared to global telecommunications peers, good liquidity and moderate financial leverage, the agency said.

The merger will strengthen HKBN and WTT's combined competitive position in the enterprise fixed-line market, Moody's said.

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