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Moody's may upgrade Digicel after assets' sale

Digicel: capital structure is 'unsustainable', according to credit-rating agency Fitch

Moody's Investors Service has placed under review for upgrade Digicel Group Holdings Limited’s Caa2 corporate family rating, its Caa2-PD/LD probability of default rating, Caa3 senior secured rating and Ca senior unsecured ratings.

Moody's has also placed under review for upgrade the senior unsecured ratings of Digicel Group Limited, Digicel Group Two Limited, Digicel Limited as well as the senior unsecured, senior secured, subordinated ratings of Digicel International Finance Limited.

The review follows Digicel’s agreement to sell Digicel Pacific Limited to Telstra Corporation Limited for a total amount of $1.85 billion. Digicel will receive a $250 million earn-out subject to revenue targets in the 2022-2024 period included in the closing price.

The company will use net proceeds of about $1.4 billion to reduce debt.

Specifically, Digicel expects to repay its $1,048 million in senior secured notes due in 2024 and most of its $425-million senior unsecured notes due in 2025 both at Digicel Group Holdings Limited level.

These notes benefit from collateral, which includes the capital stock of Digicel Pacific Limited and the capital stock of Digicel (PNG) Limited.

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Published October 28, 2021 at 3:11 pm (Updated October 28, 2021 at 7:49 pm)

Moody's may upgrade Digicel after assets' sale

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