Moody's downgrades DKT

Moody's Investors Service said it downgraded to B3 from B2 the corporate family rating of DKT Holdings ApS, and its probability of default rating to B3-PD from B2-PD. Concurrently, the agency lowered to Caa2 from Caa1 the ratings on the €1.05 billion and $410 million of backed senior secured notes issued by DKT Finance ApS. It also downgraded the ratings on TDC Holding A/S’ £425 million of senior unsecured notes due February 2023, issued under the EMTN program to B3 from B2 and changed the outlooks to negative from stable.

"The downgrade reflects the pending refinancing of the high yield bonds raised by DKT Finance, which mature in June 2023," said Carlos Winzer, a Moody's senior vice president and lead analyst for DKT, in a press release.

"Assuming a successful refinancing of this debt, the downgrade to B3 reflects that rising interest costs in the current market conditions will certainly constrain the ability of the group to generate free cash flow and reduce leverage over a prolonged period of time, while keeping its interest coverage metrics under pressure," Winzer added.

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