Moody's upgrades VNET

Moody's Ratings said it upgraded VNET Group, Inc.'s corporate family rating to B3 from Caa1 and changed the outlook to positive from ratings under review.

Previously, the rating was on review for upgrade, initiated on Jan. 26 following the company’s announcement of its planned repurchase of its $600 million convertible senior notes that became putable in February 2024.

“The rating upgrade and positive outlook reflect VNET's improved liquidity management and resultant adequate liquidity position following the company's successful redemption of its $600 million convertible senior notes and potentially enhanced funding access, with Shandong Hi-Speed Holdings Group Limited coming on as a key shareholder,” said Shawn Xiong, a Moody's vice president and senior analyst, in a news release.

“The rating action also reflects our expectation that the VNET's operating and financial performance will improve over the next 12-18 months as it generates higher earnings through growth in new cabinets.”

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