S&P raises Rogers Telecom

Standard & Poor's said it raised its ratings on Rogers Telecom Holdings Inc. (formerly Call-Net Enterprises Inc.) to BB from B-, reflecting an equalization of the ratings with its parent, Rogers Communications Inc. (BB/stable/B-2).

Furthermore, the ratings on Rogers Telecom were removed from CreditWatch, where they were placed May 11 when Rogers Communications announced that it had entered into a definitive agreement to acquire Call-Net. The acquisition closed as expected July 1, and Rogers Communications changed the name of the company on July 7.

At the same time, S&P said it affirmed the BB long-term corporate credit ratings on Rogers Communications, Rogers Wireless Inc. and Rogers Cable Inc. The outlook for Rogers Communications and its subsidiaries is stable.

S&P said the ratings on Rogers Communications reflect the consolidation of the company with its four main operating subsidiaries, which are all 100% owned: Rogers Cable, Rogers Media Inc., Rogers Wireless, and now Rogers Telecom. The company's rating reflects its high debt leverage and negative free operating cash flow, which are partially mitigated by the company's investment-grade business profile, underpinned by the strength of its national wireless business and regional cable operations.

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