Fitch downgrades Windstream

Fitch Ratings said it downgraded the issuer default rating of Windstream Corp. to BB from BB+, along with its senior unsecured notes to BB from BB+.

Windstream is a wholly-owned subsidiary of Windstream Holdings, Inc.

The outlook was revised to stable from negative.

The agency also said it affirmed the BBB- rating on Windstream's $1.25 billion senior secured revolving credit facility due 2015; $393 million senior secured credit facility tranche A3 due 2016; $281 million senior secured credit facility tranche A4 due 2017; $592 million senior secured credit facility tranche B3 due 2019; and $1.345 billion senior secured credit facility tranche B4 due 2020.

The agency also downgraded Windstream Holdings of the Midwest's issuer default rating to BB from BB+ and $100 million secured notes due 2028 to BB from BB+.

Fitch also downgraded Paetec Holding Corp.'s issuer default rating to BB from BB+ and the rating on its $450 million senior unsecured notes due 2018 to BB from BB+.

The downgrades reflect revised expectations that Windstream's gross leverage will no longer improve to a level of 3.5x or less within a 12- to 18-month time horizon, the agency said.

Fitch said it anticipates the company will continue to make progress in reducing debt, but that slower than previously expected as growth in business-service revenue has not fully offset pressures elsewhere.

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