S&P rates DKT Holdings B+

S&P said it assigned a B+ long-term issuer credit rating to DKT Holdings ApS, the ultimate parent of TDC A/S.

The agency also assigned a B+ long-term issuer credit rating to DKT Finance ApS, an indirect subsidiary and intermediate holding company of DKT Holdings.

The outlook on both companies is stable.

The ratings consider TDC's robust market position as the incumbent telecom operator in Denmark, balanced by the high leverage of the group after completion of the leveraged buyout, S&P said.

Following the upcoming squeeze-out process, DKT Holdings will own 100% of TDC for a total purchase price of about €5.4 billion, the agency explained.

This will be funded by about €700 million in equity, about €2 billion in shareholder loans and €2.8 billion in new debt, S&P said.

As a result, the agency said it estimates that adjusted debt-to-EBITDA for the consolidated group headed by DKT Holdings will be between 7.5x and 7.8x in 2018 and 2019, compared with 3.2x for TDC in 2017.

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