S&P downgrades Oi, Portugal Telecom

Standard & Poor's said it lowered its corporate credit and debt ratings on Oi SA to BB+ from BBB- on global scale and to brAA+ from brAAA on national scale and removed them from CreditWatch with negative implications, where they were placed on July 4.

The outlook on the corporate credit ratings is stable.

The agency also lowered the issue-level ratings on Portugal Telecom International Finance BV to BB+ from BBB-, in line with the downgrade of Oi, which provides a senior unconditional guarantee to Portugal Telecom bonds.

S&P said the downgrade reflects the somewhat weaker credit metrics than it previously expected in the base-case scenario, following the nonpayment of the €897 million commercial paper from Rio Forte Investments SA held by Portugal Telecom, Oi's subsidiary.

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