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Fitch affirms BT on acquisition news
Fitch Ratings said it affirmed BT Group plc’s long-term issuer default rating at BBB with a positive outlook.
The affirmation follows news that the company agreed acquire U.K. mobile network operator EE.
The transaction is valued at £12.5bn with 16% of the equity of the enlarged BT group, £1 billion raised from an equity placement, £2.3 billion of assumed EE net debt and £2.4 billion from existing cash and net new-debt financing, Fitch said.
The conservative financing of the transaction and the enlarged group’s improved operating profile are likely to lead to an upgrade of BT’s issuer default rating following the closing of the deal, the agency said.
Fitch said the acquisition of the mobile operator has good industrial logic and materially improves BT’s scale and market position.
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