Moody's rates Vivacom notes B1

Moody's Investors Service said it assigned a B1 corporate family rating and B1-PD probability of default rating to Bulgarian Telecommunications Co. EAD (Vivacom).

Concurrently, Moody's assigned a provisional B1 rating to the company's proposed €400 million senior secured notes due 2018 to be issued by the company. The outlook is stable.

Moody's said Vivacom's corporate family rating reflects the company's relatively small scale in the global telecommunications industry; its narrow geographical focus in Bulgaria; the very fierce competitive telecom market landscape in Bulgaria; revenue pressure over the coming years; and uncertainty over financial policy going forward.

The rating also reflects the company's position as a leading telecom operator in Bulgaria; Vivacom's strong track record of growing its mobile segment's market share and revenues; the company's good leverage profile; the company's diversified business model; expectations of continuous free cash flow generation in the coming years; and good maturity profile with no mandatory debt repayment until 2018, the agency said.

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