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 Refinance
1. When a business or person revises their payment schedule for repaying debt.
2. Replacing an older loan with a new loan offering better terms.
When a business refinances they typically extend the maturity date. 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 af·firm
v. af·firmed, af·firm·ing, af·firms
1. To declare positively or firmly; maintain to be true.
2. To support or uphold the validity of; confirm.
v.intr. its ratings on parent company Rogers Communications Rogers Communications Inc. (TSX: RCI.A, TSX: RCI.B, NYSE: RCI) is one of Canada's largest communications companies, particularly in the field of wireless communications and cable television, with additional telecommunications and mass media assets. Edward S. Inc. (RCI RCI Royal Caribbean International
RCI Radio Canada International
RCI Rehabilitation Council of India
RCI Residential Communities Initiative
RCI Roof Consultants Institute
RCI Remote Control Interface
RCI Residential, Commercial, Industrial ) 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 wireless communications
System using radio-frequency, infrared, microwave, or other types of electromagnetic or acoustic waves in place of wires, cables, or fibre optics to transmit signals or data. 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 mit·i·gate
To moderate in force or intensity.
miti·gation n. 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 British Columbia, province (2001 pop. 3,907,738), 366,255 sq mi (948,600 sq km), including 6,976 sq mi (18,068 sq km) of water surface, W Canada. Geography
. 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 (1) (Personal Communications Services) Refers to wireless services that emerged after the U.S. government auctioned commercial licenses in 1994 and 1995. This radio spectrum in the 1. 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 Earnings before interest, taxes, depreciation, and amortization (EBITDA)
A financial measure defined as revenues less cost of goods sold and selling, general, and administrative expenses. (EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become ) 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 pre·clude
tr.v. pre·clud·ed, pre·clud·ing, pre·cludes
1. To make impossible, as by action taken in advance; prevent. See Synonyms at prevent.
2. 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
For more information on criteria or subscriptions: