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Moody's rates Axtel note Ba3
Moody's Investors Service said it assigned a Ba3 rating to Axtel, SAB de CV's proposed $250 million senior unsecured notes due 2017.
The outlook is stable.
The proceeds of the new issue are expected to be used to repay a $311 million bridge loan incurred last December to finance the $500 million acquisition of Avantel.
The new $250 million notes are rated Ba3 because they are pari passu with, and have the same terms and conditions of, Axtel's existing $162.5 million notes, the agency said.
Despite the large size of the acquisition of Avantel, Moody's said the ratings are supported by a still strong debt-to-EBITDA ratio of 2.4x, the continued strength of Axtel's legacy business and the agency's positive perception of the acquisition of Avantel because it increased Axtel's scale and market presence, widened the company's product base and improved the composition of the customer base.
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