S&P puts Vivacom on negative watch

S&P said it placed Bulgarian Telecommunications Co. EAD (Vivacom) on CreditWatch with negative implications after it agreed to be acquired by United Group BV on Nov. 7.

“We expect Vivacom’s credit quality will weaken following completion of the transaction because it will be owned by a lower-rated company with higher leverage,” said S&P in a press release.

S&P said it forecasts United Group’s S&P Global Ratings-adjusted leverage at 7.0x-7.1x in 2019 and 6.4x-6.6x in 2020 compared with a forecast leverage ratio of 1.5x-2.0x for Vivacom in 2019 and 2020.

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