Colt Telecom's DM600M Nts Rtd 'B' by S&P;Otlk Stable.LONDON--(BUSINESS WIRE)--Standard & Poor's CreditWire 7/23/98-- Standard & Poor's today assigned as·sign tr.v. as·signed, as·sign·ing, as·signs 1. To set apart for a particular purpose; designate: assigned a day for the inspection. 2. its single-'B' long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. rating to the Deutsche mark (DM) 600 million senior notes and to the DM600 million senior convertible notes to be issued by Colt Telecom Group COLT Telecom Group plc (originally City Of London Telecommunications) is a telecommunications company based in the United Kingdom, but with operations in 13 countries in Europe. plc. The outlook is stable. Colt Telecom Group PLC was established in 1992 to build and operate local telecommunication telecommunication Communication between parties at a distance from one another. Modern telecommunication systems—capable of transmitting telephone, fax, data, radio, or television signals—can transmit large volumes of information over long distances. networks in the major European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. cities. Colt COLT. An animal of the horse species, whether male or female, not more than four years old. Russ. & Ry. 416. offers a full range of switched and nonswitched telecom products and targets large business customers and telephone carriers. The ratings primarily reflect Colt's highly leveraged balance sheet and weak financial profile as well as the considerable operational and commercial challenges faced by the company to complete its networks and to achieve a substantial customer base in each of its target markets. Also, the company faces a number of regulatory uncertainties since many European countries are still at an early stage of implementing and developing the EU's legislation to liberalize lib·er·al·ize v. lib·er·al·ized, lib·er·al·iz·ing, lib·er·al·iz·es v.tr. To make liberal or more liberal: "Our standards of private conduct have been greatly liberalized . . . their telecom markets. On the positive side, the ratings reflect the substantial opportunities offered by the liberalizing and rapidly growing European telecom markets, the competitive advantages provided by Colt's advanced technology networks and operating efficiency and the company's short but good track-record. A seasoned top management team that combines experience in the European telecom markets with experience in similar start-up ventures is also viewed as a positive factor. The company so far has been exceeding its initial business plan in terms of both network development and commercial targets. This has prompted an acceleration of its capital expenditure plans which requires substantial additional funding. The upcoming issue of senior debt, senior convertible notes and equity for total net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). of approximately UK600 million is expected to fund all investment needs until 2001. Debt coverage measures will be negative or very weak over the next few years. OUTLOOK: Stable. While medium-term debt levels will be considerably higher than initially projected this should be partly compensated by the faster revenue growth derived from the acceleration of the investment program. Projected debt coverage levels, however, are now weaker than those in the initial business plan and the rating assumes that there will not be any significant deviations from the revised business development targets, Standard & Poor's said.---CreditWire
CONTACT: Juan Jose Garcia Seijo, London (44) 171-826-3642
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