Moody's: VimpelCom notes Ba2

Moody's Investors Service said it assigned a provisional Ba2 rating to the loan participation notes of VIP Finance Ireland Ltd., an orphan special purpose vehicle created for the sole purpose of issuing notes and on-lending proceeds to Vimpel-Communications OJSC (VimpelCom).

The rating is on review for possible downgrade, in line with all other ratings of VimpelCom, which have been on review for possible downgrade since October 2010, Moody's said.

The amount and maturity on the notes are subject to the prevailing market conditions during placement. In the absence of a guarantee from the beneficiary of the proceeds of the notes, credit recourse is provided by the underlying loan agreement with VimpelCom.

This rating assumes that any future debt issuance by VimpelCom or Vimpelcom Ltd. will be undertaken on a senior unsecured basis and will rank pari passu, the agency said.

The proceeds will be used primarily to refinance VimpelCom's existing debt and for other corporate purposes, Moody's said.

The ratings consider the company's intention to merge with Wind Telecom to create the world's sixth-largest mobile telecoms company in terms of number of subscribers, the agency said.

However, there is currently uncertainty as to whether the merger will go ahead, given that one of the main shareholders opposes the deal on the grounds of conflicting interest and disagreements on the asset valuation, Moody's added.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.