Fitch: Sri Lanka Telecom on watch

Fitch Ratings said it placed Sri Lanka Telecom Ltd.'s senior unsecured local currency BB rating on Rating Watch Negative. At the same time, the senior unsecured foreign currency B+ rating and the B+ rating on its $100 million notes due 2009 have been affirmed.

Fitch said the rating action reflects a number of recent developments, which have combined to potentially weaken Sri Lanka Telecom's stand-alone credit profile.

These developments precede the devastation caused by the Indian Ocean tsunami, which extensively damaged the Sri Lankan coastline and resulted in the loss of many thousands of lives, according to Fitch.

Fitch said the affect on Sri Lanka Telecom extends to the need to replace infrastructure, loss of revenues and bad debts.

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