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S&P: ViaWest on positive watch
Standard & Poor’s said it placed the B corporate credit rating on ViaWest Inc. on CreditWatch with positive implications.
The CreditWatch placement follows news that the company signed a definitive agreement to be acquired by Shaw Communications Inc. in a transaction valued at $1.2 billion.
The ratings on ViaWest could be upgraded following the proposed acquisition by higher-rated Shaw, the agency said.
The investment-grade rating on Shaw reflects the company’s sizable cable TV operations, which serve more than 5 million revenue generating units in five Canadian provinces, S&P said.
Shaw announced it will fund the acquisition with a combination of cash and borrowings under its existing credit facility.
Following the transaction close, S&P said it expects ViaWest to be a wholly owned subsidiary of Shaw with ViaWest’s existing debt rolled over and remaining at ViaWest Inc., with no recourse to Shaw.
If Shaw is unable to amend change of control provisions at the existing ViaWest facility, the agency said it expects existing debt would be refinanced at the ViaWest subsidiary with new debt non-recourse to Shaw.
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