Moody's ratings: Tower Bersama outlook stable

Dylan Bushell-Embling
04 May 2012
00:00

Tower Bersama

Credit rating agency Moody's has confirmed its Ba2 rating and stable outlook for Indonesia's Tower Bersama Infrastructure.

The independent tower operator had been on review for a downgrade since February, when it agreed to acquire 2,500 telecom towers from Indosat for up to $519 million.

But in a statement, Moody's revealed it believes that the acquisition of these towers can be “accommodated within the parameters of [the] Ba2 rating.”

The transaction should also allow Tower Bersama to increase its Tier One revenue contribution, and to become Indonesia's largest independent tower provider by total sites, Moody's said.

Ericsson

The $1 billion in US-denominated notes issued by Ericsson's have been assigned an A3 rating.

The rating “reflects Ericsson's strong market positions, cash generation and conservative capital
structure, but also [its] currently depressed margins following management's focus on strengthening its leading market share in advanced technologies,” Moody's SVP Wolfgang Draack said.

Ericsson is currently gaining market share, and its adjusted free cash flow has been positive since April 2011, he said.

Samsung Mobile Display

Samsung's plan to amalgamate its three display panel manufacturers would likely be credit positive for the merged entity.

The vendor has proposed merging Samsung Mobile Display, Samsung Display and S-LCD into a single display business.

According to Moody's the deal would boost Samsung's control of its mobile screen business - Samsung Electronics would have a direct ownership in the merged entity of 84.8%, compared to its 64.4% ownership in Samsung Mobile Display.

It would also allow “alleviate SMD's very high product and end-market concentration” and mitigate the entity's high technology risk, Moody's said in a statement.

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