GTE NORTH INCORPORATED RATINGS UPGRADED BY DUFF & PHELPS CREDIT RATING CO.
CHICAGO, June 15 /PRNewswire/ -- Duff & Phelps Credit Rating Co. has raised the ratings assigned to the fixed income securities of GTE North Incorporated. The ratings of GTE North's first mortgage bonds have been raised from `AA' (Double-A) to `AA+' (Double-A-Plus), and the ratings of its debentures and preferred stock have been raised from `AA-' (Double- A-Minus) to `AA' (Double-A). GTE North is also the primary obligor for approximately $195 million of Telephone Facility Lease Bonds issued to finance GTE Corporation's Telephone Operations headquarters in Irving, Texas. The rating of the lease obligation bonds has been raised from `AA-' (Double-A-Minus) to `AA' (Double-A). As of March 31, 1993, GTE North had just over $1.6 billion of debt and preferred stock outstanding. On April 1, 1993, the GTE North properties in Illinois, Indiana, Michigan, Ohio, Pennsylvania, and Wisconsin were merged with the Contel properties in these states. The GTE North properties in Iowa, Minnesota, Missouri, and Nebraska were transferred into a newly created entity, GTE Midwest Incorporated, and merged with other Contel properties. The new GTE North is a slightly larger company with modestly stronger measures of financial protection. Pretax interest coverages are expected to be maintained in excess of 5.0 times, and internally generated funds should exceed projected capital expenditures over the forecast period. The company has benefited from the aggressive cost-cutting efforts. GTE North has demonstrated a commitment to modernizing its network, even though it serves a more rural and suburban service territory. An important rating consideration is the relatively lower level of competition that GTE North faces because of its less urban service territory. Equally important is the commitment by GTE Corporation, GTE North's parent, to maintain GTE North's common equity ratio near 60 percent. Following the reorganization, GTE North provides local telecommunications services and access to the networks of long distance carriers to 3.9 million access lines in six states. The largest cities in the service territory are Fort Wayne and Terre Haute, Indiana; Erie and York, Pennsylvania; and Bloomington/Normal, Illinois. -0- 6/15/93 /CONTACT: James J. Stork, CFA of Duff & Phelps Credit Rating Co., 312-368-3125/ (GTE)
CO: GTE North Incorporated ST: IN: TLS SU: RTG
TM -- NY110 -- 2371 06/15/93 17:30 EDT
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|Date:||Jun 15, 1993|
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