S&P rates Windstream notes B+

Standard & Poor's said it assigned a B+ rating to Windstream Corp.'s proposed $400 million of senior notes due 2018 with a recovery rating of 5, indicating an expectation for 10% to 30% recovery in a default, and affirmed Windstream's BB- corporate credit rating.

The outlook is stable.

The company will use the note proceeds to repay debt currently drawn under the senior secured revolver and for general corporate purposes.

The ratings continue to reflect an aggressive shareholder-oriented financial policy with a commitment to a substantial common dividend, which limits potential debt reduction, S&P said.

Tempering factors include the company's still-dominant position as the leading provider of local and long-distance telecommunications services in less competitive and geographically diverse secondary and tertiary markets, growth from digital subscriber line services, still-healthy EBITDA margins and solid free operating cash flow, the agency said.

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