At the same time, the agency raised the ratings of the senior unsecured debt instruments and the senior unsecured bank credit line issued by TIM, its subsidiaries Telecom Italia Capital and Telecom Italia Finance to “Ba3” from “B1”.
L’outlook on all three companies it is positive.
“The upgrade, we read in a note, reflects the significant improvement in the financial profile thanks to the planned debt reduction of over 14 billion euros, which will more than compensate for the deterioration of its business profile” he states Ernesto Bisagno, Vice President of Moody’s – Senior Credit Officer.
This rating action concludes the upgrade review process started by Moody’s on November 6, 2023, when TIM announced the sale of its fixed network assets (NetCo) to funds managed by KKR for an enterprise value of 18.8 billion euros (which rises to 22 billion euros considering any earn-outs), explains a note from the agency.
“The positive outlook reflects the recent solid operational performance and our expectation that Telecom Italia’s credit metrics will improve over the next two years, supported by continued recovery in profits ongoing”, added Bisagno.
The rating update reflects considerations on corporate governance linked to Telecom Italia’s decision to pursue a more conservative financial policy and a lower tolerance for financial leverage compared to before the sale of NetCo. Financial strategy and risk management is a governance consideration under Moody’s General Principles for Assessing Environmental, Social and Governance Risks methodology.
(Teleborsa) 12-06-2024 20:06
