S&P rates Axian Telecom, notes B+

S&P said it gave Axian Telecom and its planned $420 million of senior unsecured notes preliminary B+ ratings.

“We anticipate that the group will generate robust free operating cash flow (FOCF), which will see it steadily deleverage from S&P Global Ratings-adjusted debt to EBITDA of about 2x in 2020 to pro forma adjusted leverage of about 1.8x in 2023,” S&P said in a press release.

The agency also said it forecasts S&P Global Ratings-adjusted EBITDA margins of 50%-55% over 2021-2023.

Axian plans to use the proceeds to settle its Tanzania acquisition of $105 million and repay acquisition-related senior secured term debt of $196 million and net term debt at operating subsidiary Agou Holding SAS of $40 million. It also earmarked $67 million for general corporate purposes and $12 million to cover bond issuance costs.

The outlook is stable.

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