Moody’s has assigned America Movil’s (AMX) proposed issuance of debt of up to MXN20bn (US$1.52bn) A2 global foreign currency and Aaa.mx national scale ratings. Standard & Poor’s rated the senior unsecured notes A- on the global scale and mxAAA on…
Moody’s has assigned America Movil’s (AMX) proposed issuance of debt of up to MXN20bn (US$1.52bn) A2 global foreign currency and Aaa.mx national scale ratings. Standard & Poor’s rated the senior unsecured notes A- on the global scale and mxAAA on national scale ratings.
The senior unsecured notes mature in 2022, and proceeds will be used for debt refinancing and other corporate purposes.
Moody’s noted that the issue will be made without guarantees by AMX largest subisdiary, Mexican mobile operator Radiomovil Dipsa, which in the past provided guarantees to AMX unsecured notes. Following new financial policies AMX stopped to do so about a year ago, in October 2011.
“ Despite the effective subordination of the unguaranteed notes, Moody’s has not notched the respective ratings below the existing A2 senior unsecured rating due to overall strength of America Movil and the expectation that going forward all debt issued by the group will no longer carry a guarantee,” Moody’s said.
“The decision was also based on the assumption that America Movil will not materially increase the current level of debt at its subsidiaries, which would further subordinate the debt at the holding company, America Movil.”
S&P said its rating reflects AMX’ strong business risk and modest financial risk profile. “Our assessment is based on the company’s leading position in the Latin American telecom industry, its solid profitability, and our expectation that it will maintain robust cash flow generation despite intense competition in some of its
markets,” S&P said.
