America Movil (AMX) is planning to issue up to Ps15bn (US$1.2bn) in senior unsecured notes due 2018.
The Mexican incumbent is expected to use the proceeds from the issuance for general corporate purposes including debt refinancing.
Fitch rated the…
America Movil (AMX) is planning to issue up to Ps15bn (US$1.2bn) in senior unsecured notes due 2018.
The Mexican incumbent is expected to use the proceeds from the issuance for general corporate purposes including debt refinancing.
Fitch rated the notes A while Moody’s assigned A2, but left it under review for a downgrade; the same as its view of AMX as a company.
It put AT&T under review for a downgrade following its offer to takeover Dutch incumbent KPN. Whether it is downgraded will largely depend on if it completes the KPN deal, and if it does then how the transaction will be financed and what KPN’s capital structure will look like, and also how it would propose to de-lever post-transaction.
Fitch was less cautious, saying it did not expect a deal to stop AMX reaching a pro forma net debt-to-EBITDA ratio of 1.5x before the end of 2014, which its current rating is based upon.
However, a negative rating action could occur if “net leverage increases between 1.5x-2.0x on a sustained basis as a result of operational or strategic factors”, Fitch said in a memo.
AMX and KPN remain locked in talks about a potential €7.4bn (US$9.9bn) takeover offer, which has been complicated by a challenge from the foundation charged with protecting the Dutch telco’s stakeholders. The Mexican telco had been touted to formalise its offer this week.
