S&P Afms Rogers Commun Rtgs, Rates Rogers Cantel Nts.

NEW YORK--(BUSINESS WIRE)--S&P CreditWire 9/30/97--Standard & Poor's today assigned its double-`B'-plus rating to Rogers Cantel Inc.'s US$275 million senior secured notes and its double-`B'-minus rating to the company's US$215 million senior subordinated notes. Proceeds will be used to refinance Cantel's existing US$200 million senior subordinated notes due 2002 and to initially repay all outstanding short-term and bank debt.

Standard & Poor's affirmed its ratings on parent company Rogers Communications Inc. (RCI) and related entities (see list below) following the announcement that Rogers Cantel Inc. will shift its digital/PCS strategy.

In the face of growing competition, Cantel will shift its digital/PCS services from premium products to mass marketed offers targeted at both the consumer and business segments. This process will involve an acceleration of Cantel's 1.9GHz network build and the introduction of two new lower-priced offerings designed to grow volumes on Cantel's digital/PCS capacity.

The enhanced financial risk associated with Cantel's strategic initiative is currently offset by:

-- RCI's strong market positions in the Canadian

cable television and wireless communications sectors,

-- The improved financial performance of Rogers

Cablesystems Ltd., and

-- The potential future benefits arising from the measures

taken by Cantel.

In addition, these factors mitigate to some extent the impact on the group of growing competition in the historically protected cable and wireless markets in Canada.

Through its Rogers Cablesystems Ltd. subsidiary, RCI is currently Canada's largest cable television services provider and serves 2.2 million basic cable subscribers in Ontario and British Columbia. At the same time, RCI's subsidiary, Rogers Cantel Inc., is one of the largest cellular operators in Canada serving 1.4 million subscribers and has a 40% share of a fast-growing market. Cantel is also one of the two incumbent cellular service providers to receive a license to provide PCS services.

In addition to the strategic shift at Cantel, several other groupwide initiatives should serve to further strengthen RCI's business position and better prepare the group for increased competition in its core markets. RCI is taking measures to reduce cost, expand its product offerings, upgrade its cable network, and increase its focus on customer service as a means to enhance customer retention especially in its wireless business where the costs of customer acquisition remain high. While serving to further strengthen RCI's business position in the face of competition, these measures should ultimately improve the group's profitability. Improvements in profitability should also enhance RCI's debt protection measures which have historically been weak, reflecting the company's high debt leverage. Earnings before interest, taxes, depreciation, and amortization (EBITDA) interest coverage was 1.6 times (x) and total debt stood at 6.5x on an operating lease-adjusted basis at financial year-end Dec. 31, 1996.

OUTLOOK (RCI): STABLE

The scale of ongoing capital expenditures and potential marketing expense, while necessary to prepare RCI for growing competition, likely will preclude a material improvement in the credit quality of RCI in the near to medium term, Standard & Poor's said. ---CreditWire -0-

OUTSTANDING RATINGS AFFIRMED
                             Rating
Rogers Communications Inc.
  Corporate credit rating    BB+
  Senior unsecured debt      BB-
Rogers Cablesystems Ltd.
  Senior secured rating      BB+
  Subordinated debt          BB-
Rogers Cantel Inc.
  Senior secured debt        BB+
  Subordinated debt          BB-

CONTACT: Edward Lawrence, Toronto (1) 416-202-6003

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