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Moody's rates UbiquiTel notes Caa1
Moody's Investors Service said it assigned a Caa1 rating to the pending $250 million issuance of senior notes due 2011 by UbiquiTel Operating Co. Moody's also upgraded the company's senior implied to B3 from Caa1, the $48 million 14% senior discount notes due 2010 to Caa1 from Caa3, and the $100 million 14% subordinated discount notes due 2010 to Caa3 from C.
The outlook is stable.
Moody's said the upgrade of the senior implied rating to B3 reflects the considerably reduced default risk for the company as financial performance has exceeded expectations and is forecasted to continue to improve at a rapid pace. Further, financial flexibility will be increased through the elimination of the company's secured credit facility, the ratings for which have been withdrawn, and its attendant amortization and covenant requirements.
Implicit in the higher B3 senior implied rating is also the assumption that UbiquiTel will be able to continue to grow revenues rapidly and expand margins.
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