MTN hit with ratings downgrade
Moody’s Investors Service has downgraded MTN Group’s global issuer rating to Baa3 from Baa2, because of a $3.9 billion the group is facing in its biggest market, Nigeria.
The outlook is negative, Moody’s said.
“The downgrade to Baa3 captures the increased operational and sovereign risks from one of its key markets, Nigeria (Ba3 stable), where MTN Nigeria is a sizable contributor to Group EBITDA representing 48% of consolidated EBITDA (as of 30 June 2015).
“Furthermore, there continues to be uncertainty around the final outcome regarding the Naira 780 billion ($3.9 billion) fine imposed by the Nigerian Communications Commission (NCC) on MTN Nigeria of which payment is required by the 31 December 2015,” the ratings group said in a statement.
Moody’s said that he negative outlook reflects the ongoing uncertainty surrounding NCC fine and the possible impact on MTN’s liquidity profile given MTN at this point does not have sufficient funds readily available to immediately pay the $3.9 billion equivalent fine.
It said that the outlook could be stabilised if matters surrounding the Nigerian fine are clarified and resolved with limited or manageable implications to MTN’s Nigerian and Group operations.
More on MTN
MTN Nigeria woes continue as fine is increased
MTN Nigeria fine cut by a third
Loading ...