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Prospect News home > News index > List of issuers L > Headlines for Level 3 Communications, Inc. > News item |
Fitch puts Level 3 on positive watch
Fitch Ratings said it placed the B- issuer default rating assigned to Level 3 Communications, Inc. and its wholly owned subsidiary Level 3 Financing, Inc. on Rating Watch positive.
The ratings on positive watch include Level 3 Communications' B- issuer default rating and CCC senior unsecured notes rating with a recovery rating of RR5. Level 3 Financing's B- issuer default rating, BB- senior secured term loan rating with a recovery rating of RR1 and B+ senior unsecured notes rating with a recovery rating of RR2 also were placed on positive watch.
The watch follows news that the company entered into definitive agreements to acquire Global Crossing Ltd. in a tax-free, stock-for-stock transaction valued at about $3 billion, Fitch said.
Fitch said it believes that the proposed transaction will strengthen Level 3's competitive position by improving the breadth and depth of its service offering, positioning the company to expand into new markets and broadening the spectrum of customers that the company serves.
The proposed transaction will de-lever Level 3's balance sheet and enable the company to further improve credit protection metrics and generate positive free cash flow, the agency said.
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