Moody’s ups Nokia, withdraws Alcatel-Lucent

Moody's Investors Service said it upgraded Nokia Oyj’s corporate family rating and the senior unsecured debt instrument ratings to Ba1 from Ba2 and its probability of default rating to Ba1-PD from Ba2-PD.

The Not Prime (NP) rating on commercial paper issued by Nokia and by Nokia Finance International BV was affirmed.

Nokia’s outlook remains stable.

Concurrently, the agency withdrew the B2 corporate family rating and B2-PD probability of default rating on Alcatel-Lucent as well as the B3 debt-level ratings on its senior unsecured convertible bonds due 2019 and 2020 because it believes it has insufficient or otherwise inadequate information to support the maintenance of those ratings.

Moody’s said the upgrade of Nokia's ratings principally reflects the enhanced scale and diversification of Nokia following its combination with Alcatel-Lucent as well as the notable progress Nokia has made, through a series of concrete transaction milestones, in furthering its combination with Alcatel-Lucent since announcing the transaction in April 2015.

These are in addition to material debt reduction that Nokia has effected at both Nokia and Alcatel-Lucent over the past year as well as an expectation for an improved financial profile for the combined company over the next 18 months.

The upgrade to Ba1 of the debt instrument ratings on Nokia's senior unsecured notes and euro medium-term note program correspond to the declining default risk of these obligations as Nokia's corporate family rating approaches an investment-grade level.

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