Moody’s rates Uniti notes Caa2

Moody's Investors Service said it assigned a Caa2 rating to Uniti Group Inc.'s proposed $700 million senior notes due 2030 which will be issued jointly by Uniti Group LP, Uniti Fiber Holdings Inc., Uniti Group Finance 2019 Inc. and CSL Capital, LLC.

“The Caa2 rating is in line with the rating on the existing unsecured debt,” the agency said in a news release.

The net proceeds from the sale of the new notes will be used to fund the redemption of the company's 7 1/8% senior notes due 2024, including related premiums, with any remaining net proceeds used to prepay Windstream Services, LLC settlement obligations.

Under the company's settlement agreement with Windstream and in conjunction with Windstream's bankruptcy exit in September 2020, Uniti is obligated to pay Windstream a total of $490.1 million over 20 consecutive quarters and is also entitled to prepay any settlement obligation installments, discounted at a 9% rate.

All other ratings, including Uniti's B3 corporate family rating and stable outlook, are unchanged.

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