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Fitch gives BBB- to Globo notes
Fitch Ratings said it assigned a BBB-(EXP) rating to Globo Comunicacao e Participacoes SA's proposed $200 million senior unsecured notes due 2027.
The proposed senior unsecured notes will replace Globo's $200 million step-up senior notes issued in 2012 and will not represent any cash inflow to the company. Through a structured transaction, the step-up notes will be purchased, amended and replaced into the proposed senior unsecured notes.
Globo will transfer the call option for all of the outstanding step-up notes to Pontis IV Ltd. Pontis IV will issue $200 million senior exchangeable notes in order to fund the transaction. Subsequently, the senior exchangeable notes will be mandatorily exchangeable for Globo's $200 million amended senior unsecured notes due 2027.
Fitch said the ratings reflect Globo’s strong business profile as the largest broadcaster and pay-TV programming provider in Brazil, supported by its strong content production. The ratings also reflect the company's strong cash flow generation, which enables its robust financial profile with zero leverage (positive net cash).
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