Moody's rates Cablemas notes B1

Moody's Investors Service said it assigned a B1 rating to Cablemas, SA de CV's proposed $165 million of senior unsecured notes due 2015. The outlook is stable.

The agency said the proceeds of the transaction will be used to refinance debt and for capital expenditures.

Moody's noted the rating reflects Cablemas' dependence on debt to finance building out its network, the lack of free cash flow generated from operations in the near term and the pressure on operating margins caused by relatively high churn.

These risks are offset by its position as Mexico's second largest cable TV operator, with a 17% market share in a fragmented market of 120 cable TV operators, and the advanced degree of its network upgrades to support data service offerings, the agency added.

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