Fitch rates Digicel note add-on B

Fitch Ratings said it has assigned a rating of B to Digicel Ltd.'s proposed add-on offering of $150 million 9.25% senior notes due 2012. These notes are an extension of the $300 million notes issued in July 2005.

Proceeds from the issuance are expected to be used for investments outside the restricted group in the Trinidad & Tobago and Haiti operations to build network capacity in order to meet demand, which was higher than originally anticipated by the company, reaching over 600,000 subscribers in the first quarter of operations ended June 30.

In addition, Fitch also affirmed Digicel's foreign currency issuer default rating and the existing $300 million senior notes due 2012 at B.

The outlook is stable.

Digicel's ratings reflect its position as the leading provider of wireless services in the Caribbean, its strong brand recognition, growing portfolio of wireless assets and its manageable - yet high - financial leverage, the agency said.

The ratings are constrained by increased debt levels and negative consolidated free cash-flow generation, Fitch said.

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