S&P ups Vestel Elektronik, rates notes B+

Standard & Poor's said it raised its long-term corporate credit rating on Vestel Elektronik Sanayi Ve Ticaret AS to B+ from B. The outlook is stable. The long-term rating on the outstanding senior unsecured debt guaranteed by Vestel and housed at Vestel Electronics Finance Ltd. and Financial Enterprises Ltd. was also raised to B+ from B.

At the same time, S&P said it assigned its B+ long-term debt rating to the proposed guaranteed senior unsecured notes to be issued by Vestel Electronics Finance Ltd.

Proceeds from the note offering will be used to repay the outstanding $200 million notes due in 2007.

S&P said the upgrade reflects markedly higher headroom under the recently amended financial covenants of Vestel's public debt indentures and S&P's belief that headroom will remain adequate over the medium term. It also reflects the company's 2004 operating performance, which was in line with S&P's expectations in a context of a more stable currency environment and highly competitive consumer electronics and white-goods markets.

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