Moody's rates Telenet loans Ba3

Moody's Investors Service said it assigned Ba3 ratings to the term loan AO2 due 2027 issued by Telenet International Finance Sarl and term loan AN2 due 2026 issued by Telenet Financing USD LLC.

Both are subsidiaries of Telenet Group Holding NV, the agency explained.

The aggregated loan amount for these term loans is €610 million.

Telenet's corporate family rating at Ba3, probability of default rating at Ba3-PD and all of the existing debt instrument ratings at Ba3 are unchanged.

The outlook is stable.

This debt issuance will increase Moody's adjusted gross debt-to-/EBITDA for Telenet to about 4.6x based on the last 12 months of EBITDA as of June 30, compared to about 4.1x prior to the transaction, Moody's said.

The proceeds from the issuance will be used to fund extraordinary dividends of €600 million announced by Telenet at its half year results for 2018, the agency said.

While the company's moderate leverage as of the first half of 2018 has provided it with reasonable headroom, Moody's also said it does not expect significant debt-financed acquisitions over at least the next 12 months.

The ratings are constrained by weak revenue growth prospects and intense competition in the residential market, the agency said.

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