10th Jun 2016 05:40
LONDON (Alliance News) - Moody's Investor Service has upgraded its credit ratings for BT Group PLC and its newly acquired mobile network EE, saying this reflected BT's "strengthened business risk profile" following the integration of its fixed and mobile activities.
Moody's has upgraded its Prime-2 short term ratings for BT and British Telecom Finance BV to Baa1 from Baa2, and upgraded BT's senior unsecured debt ratings, its MTN programme rating, and senior unsecured shelf rating to Baa1 from Baa2 also.
Similarly, it increased the issue rating of EE Ltd and senior debt ratings of EE Finance PLC to Baa1 from Baa2.
Both a Baa1 and a Baa2 rating are investment grade.
Moody's said the outlook on all the ratings is stable.
Moody's said that following the acquisition of EE, BT now benefits from increased size and scale, and exposure to both fixed and mobile businesses, which will allow BT to offer attractive bundles of fixed voice, broadband, mobile and television services. It expects BT to continue to reduce its debt and improve its credit metrics, driven by sustained revenue, earnings and free cash flow growth.
"These strengths put BT in a better position to mitigate the potential headwinds from increasing competition in the UK market, tougher regulation, and content cost inflation," said Ivan Palacios, Moody's lead analyst for BT.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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