Moody's may cut PCCW-HKT

Moody's Investors Service said it placed the Baa2 senior unsecured ratings of PCCW-HKT Telephone Ltd. and its supported entities under review for possible downgrade.

The action follows news about a joint privatization proposal was made by Starvest Ltd. and China Netcom Corp. Ltd.

The proposed privatization will bring about an increase in leverage at Hong Kong Telecommunications Ltd. given the drawing of HK$23.8 billion in loan facilities, which will increase total debt by HK$7,200 million and is likely to place negative pressure on the rating, Moody's said.

Moody's also said it is concerned that the proposed privatization may bring about a diminution in corporate transparency and governance and may cloud future clarity over shareholder ambitions and strategy particularly with regard to dividend policies.

© 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.