Moody's rates DKT Finance notes B3

Moody's Investors Service said it assigned B3 ratings to the proposed €1.4 billion equivalent senior notes due 2023 to be issued by DKT Finance ApS, a finance vehicle 100% owned by DKT Holdings ApS.

DKT owns 100% of Danish telecom operator TDC A/S.

The outlook is stable.

All other ratings of DKT and TDC are unchanged.

The ratings follow news of TDC's takeover by DKT, Moody's explained, and is part of the exercise aimed at structuring a permanent capital structure for TDC.

The rating assigned to the proposed €1.4 billion equivalent senior notes is two notches lower than the B1 corporate family rating of DKT, two notches lower than TDC's B1 senior unsecured bond ratings and three notches lower than the Ba3 rating assigned to the term loan B and revolver issued by TDC, Moody's said.

The B3 rating on the senior notes reflects their structural subordination to the €5.4 billion debt at TDC level the agency noted.

The ratings reflect the combination of the group's strong business profile and expectation of improved operating performance, Moody's said, offset by the impact on the group's credit metrics from the substantial debt incurred to finance the buyout.

The agency said it expects the group will continue to be managed with a somewhat aggressive financial profile under its current ownership structure with limited expected de-leveraging.

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