Fitch rates Verizon notes A-

Fitch Ratings said it assigned an A- rating to Verizon Communications, Inc.'s senior unsecured exchange notes due 2028.

The company began an offer to exchange 13 series of notes (the old notes) for newly issued senior unsecured notes. The new notes will bear an interest rate of 4.329% and the maximum amount of new notes issued will be about $4.3 billion. In addition, the company will increase its cash offer for old notes from $250 million to an amount sufficient to allow it to purchase all old notes validly tendered.

The company’s long-term issuer default rating is A-/stable.

Fitch said the ratings are supported by Verizon Wireless' strong competitive position, as evidenced through industry-low churn rates, high margins and the extensive coverage of roughly 98% of the U.S. population with its 4G LTE network.

“These factors are balanced against the intensely competitive wireless environment as well as the moderately high leverage for the rating,” the agency said in a news release.

“The traditional smartphone offering has matured, and Verizon has had to respond to smaller operators competitively, while emerging applications, where Verizon is strongly positioned, are in a nascent stage.”

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