S&P lowers Vodafone view to negative

Standard & Poor's said it revised the outlook on Vodafone Group plc to negative from stable.

The agency also said it affirmed the A- long-term and A-2 short-term corporate credit ratings on the group

The outlook revision follows news that the company has agreed to acquire ONO SA for a total of €7.2 billion on a debt- and cash-free basis, S&P said.

The ratings reflect the group's strong business risk profile and intermediate financial risk profile, the agency said.

S&P said it believes the size of the ONO purchase, combined with Vodafone's heightened capital spending, substantially erodes the company's headroom under the current rating.

Vodafone will likely lengthen its recent string of acquisitions to keep pace with industry consolidation and continue to replace cash flows upstreamed previously from Verizon, the agency added.

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