Moody’s ups Portugal Telecom

Moody’s Investors Service said it has upgraded to Baa3 from Ba2 the long-term senior unsecured bond ratings, to provisional Baa3 from provisional Ba2 the rating on the EMTN program of Portugal Telecom SGPS, SA and its financing subsidiary Portugal Telecom International Finance BV.

The outlook is negative.

"Portugal Telecom's upgrade to Baa3 reflects predominantly the explicit guarantee that its bondholders now have as well as the company's stronger global diversification and greater financial strength all owing to its merger with Oi SA," said Carlos Winzer, a Moody's senior vice president and lead analyst for Portugal Telecom.

“In addition, the guarantee from Oi mitigates Portugal Telecom's exposure to the domestic Portuguese macroeconomic risks," added Winzer.

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