Moody's ups Ericsson to Baa1

Moody's Investors Service said it upgraded to Baa1 from Baa2 the long-term debt ratings of Telefonaktiebolaget LM Ericsson, including its senior unsecured bank credit facility, senior unsecured medium-term note program and senior unsecured regular bond/debenture. Moody's said it also affirmed the company's prime-2 short-term debt ratings.

The outlook is stable.

The upgrade is based on Ericsson's growing track record of robust profitability and very conservative financial structure balancing its exposure to the cyclical telecommunications equipment industry with moderate growth expectations and a consolidating customer and supplier base, the agency said.

The upgrade is constrained by Ericsson's reliance on one sector, mobile communication networks with a concentrated customer base, the expected moderate growth of the telecom equipment industry and the consolidation among both telecom operators and equipment providers, Moody's said.

Moody's previous rating action on Ericsson was the upgrade of its ratings to Baa2/Prime-2 with stable outlook on 27 June 2006.

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