Fitch puts PCCW-HKT on negative watch

Fitch Ratings said it has placed PCCW-HKT Telephone Ltd.'s BBB+ long-term issuer default rating on rating watch negative following confirmation that its parent, PCCW Ltd., has received - and is assessing - a non-binding expression of interest from a third party in relation to a possible acquisition of substantially all of the telecommunications and media related assets of PCCW.

PCCW-HKT Telephone's senior unsecured debt instruments' ratings of BBB+ have also been placed on negative watch.

Fitch notes that PCCW's telecommunications and media-related assets largely include its 100% interest in PCCW-HKT Telephone, which is Hong Kong's incumbent fixed-line operator and whose assets generate much of PCCW's cash flow.

Fitch said the possibility that PCCW-HKT Telephone could in the future experience a change in business and financial risk profile.

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