S&P changes Primus' outlook to stable

Standard & Poor's revised the outlook on Primus Telecommunications Group Inc. to stable from negative as a result of the company's success in maintaining and increasing its customer base, as well as associated revenues and EBITDA, in a very challenging economic and competitive climate.

In the first quarter of 2003, the company's revenues grew 23% from the prior year, EBITDA grew to $33 million, versus $21 million for the previous year, and debt declined to $562 million at March 31, 2003, from $668 million at Dec. 31, 2001, and $1.256 billion at Dec. 31, 2000 due to open market debt repurchases, vendor settlements and conversions of convertible subordinated debt.

"Standard & Poor's had been concerned about the company's liquidity in light of the relatively high concentration of its business with financially distressed telecommunications carriers," said Standard & Poor's credit analyst Catherine Cosentino. "In recent periods, nevertheless, Primus has been able to reduce its dependence on the carrier sector, which now makes up about 20% of its revenues, down from 24% in the first quarter of 2002. This has been accomplished through ongoing growth in the residential long-distance base, as well as tightened credit policies for carrier customers."

S&P affirms Mirant CC credit rating

Standard & Poor's Ratings Services announced that Monday that its CC corporate credit rating on Mirant Corp. remains on CreditWatch with negative implications, and its ratings on Mirant's securities remain on CreditWatch with developing implications.

The CreditWatch update follows the company's announcement that it has revised the terms of its exchange offer and the company has received indications that a high percentage of affected bondholders would approve the company's restructuring plans.

Mirant is involved in complex negotiations with classes of bondholders and its commercial bank creditors to extend debt maturities and avert an otherwise likely bankruptcy filing. Mirant has asked creditors holding approximately $4.5 billion of Mirant unsecured debt that matures on or before May 1, 2006, to amend terms to extend their debt maturities to July 14, 2008. The amendment is to be achieved by creditors exchanging their obligations for new secured obligations in which Mirant will pledge essentially all of its remaining unencumbered assets and grant warrants on Mirant's common equity.

If Mirant cannot complete the exchange offer, it likely will file for bankruptcy protection, whether through a prepacked transaction or otherwise.

Atlanta, Ga.-based Mirant has about $9.7 billion in debt, including lease-related debt.

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