Moody’s lowers Intelsat, loan, bonds

Moody's Investors Service said it downgraded Intelsat SA's corporate family rating and probability of default ratings to Caa2 from B3 and Caa2-PD from B3-PD, respectively, and changed the outlook to negative from stable.

All of the company's debt instrument ratings at Intelsat Jackson Holdings SA were downgraded: senior secured bank credit facility to B1 from Ba3; senior unsecured guaranteed bonds/debentures to Caa2 from B3; and senior unsecured non-guaranteed bonds/debentures to Caa3 from Caa1.

Intelsat (Luxembourg) SA's senior unsecured regular bonds/debentures were downgraded to Ca from Caa2.

Intelsat's speculative grade liquidity rating was affirmed at SGL-3, indicating adequate liquidity.

Moody’s said the actions were prompted by a combination of business fundamentals and capital structure considerations that, from the agency’s perspective, signal the company's debt structure has become unsustainable.

In particular, while Intelsat's major fixed satellite services peer companies report of challenging conditions in the network services sector, a segment that Moody's views being highly commoditized, with Intelsat's revenue mix disproportionately exposed to that sector, future growth prospects are uncertain.

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