Please Note
We brought you to this page based on your search query. If this isn't what you are looking for, you can continue to Search Results for ""
The maximum number of items you can export is 3,000. Please reduce your list by using the filtering tool to the left.
Close
Você está prestes a deixar o site local do Brasil e será direcionado ao site global. Deseja continuar?
Não exibir esta mensagem novamente
Sim
Não
Close
Email Research
Recipient email addresses will not be used in mailing lists or redistributed.
Recipient's
Email

Use semicolon to separate each address, limit to 20 addresses.
Enter the
characters you see
Close
Email Research
Thank you for your interest in sharing Moody's Research. You have reached the daily limit of Research email sharings.
Close
Thank you!
You have successfully sent the research.
Please note: some research requires a paid subscription in order to access.
Already a customer?
LOG IN
Don't want to see this again?
REGISTER
OR
Accept our Terms of Use to continue to Moodys.com:
​​

PLEASE READ AND SCROLL DOWN!

By clicking “I AGREE” [at the end of this document], you indicate that you understand and intend these terms and conditions to be the legal equivalent of a signed, written contract and equally binding, and that you accept such terms and conditions as a condition of viewing any and all Moody’s inform​ation that becomes accessible to you [after clicking “I AGREE”] (the “Information”).   References herein to “Moody’s” include Moody’s Corporation, Inc. and each of its subsidiaries and affiliates.

Terms of One-Time Website Use

1.            Unless you have entered into an express written contract with Moody’s to the contrary, you agree that you have no right to use the Information in a commercial or public setting and no right to copy it, save it, print it, sell it, or publish or distribute any portion of it in any form.               

2.            You acknowledge and agree that Moody’s credit ratings: (i) are current opinions of the future relative creditworthiness of securities and address no other risk; and (ii) are not statements of current or historical fact or recommendations to purchase, hold or sell particular securities.  Moody’s credit ratings and publications are not intended for retail investors, and it would be reckless and inappropriate for retail investors to use Moody’s credit ratings and publications when making an investment decision.  No warranty, express or implied, as the accuracy, timeliness, completeness, merchantability or fitness for any particular purpose of any Moody’s credit rating is given or made by Moody’s in any form whatsoever.          

3.            To the extent permitted by law, Moody’s and its directors, officers, employees, representatives, licensors and suppliers disclaim liability for: (i) any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with use of the Information; and (ii) any direct or compensatory damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud or any other type of liability that by law cannot be excluded) on the part of Moody’s or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with use of the Information.

4.            You agree to read [and be bound by] the more detailed disclosures regarding Moody’s ratings and the limitations of Moody’s liability included in the Information.     

5.            You agree that any disputes relating to this agreement or your use of the Information, whether sounding in contract, tort, statute or otherwise, shall be governed by the laws of the State of New York and shall be subject to the exclusive jurisdiction of the courts of the State of New York located in the City and County of New York, Borough of Manhattan.​​​

I AGREE
Rating Action:

Moody's assigned a (P) B1 rating to Alestra and its proposed global notes. The ratings outlook is stable.

 The document has been translated in other languages

27 Jul 2009

Approximately USD 200 million in proposed debt instruments affected.

Mexico City, July 27, 2009 -- Moody's Investors Service assigned a provisional (P) B1 Corporate Family Rating to Alestra, S. de R.L. de C.V. (Alestra) and to its USD 200 million proposed senior unsecured global notes due in 2014. The ratings are provisional, meaning that it is highly likely that the ratings will become final after the notes are issued into the market.

Proceeds from the proposed global notes will be used to prepay, in 2009, USD 193 million in global notes due in 2009 and 2010 as well as for general corporate purposes. The ratings assume that the terms and conditions of the new notes will be in line with those prevailing in the indenture of the current outstanding notes.

"The ratings reflect Alestra's small revenue size, a strong competitive environment, its solid operating margins and customer base as well as its robust technological platform", said Nymia Almeida, Moody's senior analyst. The ratings outlook is stable. Alestra's small revenue size, relative to the telecommunications market in Mexico, weighs down the ratings; the company's small size is illustrated by its small market share of 11% of the Mexican value-added services (VAS) market and 1.6% of the Mexican total telecom market (excluding pay TV), as of 2008. In addition, because Alestra operates only in large Mexican cities, the company has limited geographic and business diversity, which increases the risk of abrupt revenue losses in a business downturn and reduces its ability to absorb a temporary disruption or an unexpectedly low return on its capital investments. Alestra's transformation over the course of this decade from a provider of primarily long distance (LD) telecom services to a provider of primarily VAS telecom services supports the ratings. The company's move stemmed from pressure on global long distance voice providers, as excess capacity and competition from mobile, fixed line and broadband services dramatically reduced the profitability of LD services. As a result, Alestra has substantially increased its focus on VAS offerings, such as Virtual Private Networks, Internet, data hosting, IP telephony and network security. In 1999, LD represented 93% of sales and most of EBITDA; today, LD represents 30% of revenues and 17% of EBITDA. This move was positive since sale of bundled VAS boosted the company's adjusted EBITDA margin from 24% in 2004 to 30% in 2005, with stable margins thereafter. In addition, the VAS market has solid growth prospects going forward due to increasing demand for data services, which should be supportive of Alestra's revenue growth and margins. For instance, in 2008 and so far in 2009, Alestra's VAS revenues grew by 12% and 15%, respectively.

Alestra's operating cash flow growth is dependent on overall market growth and on its ability to take market share from Telmex and Axtel. Telmex (rated A3, Stable) had sales of USD 9.4 billion during last twelve months ended in June 30, 2009, while Axtel (rated Ba2, Stable) posted sales of USD 880 million in the same period. Because telecom operators in Mexico are focusing their marketing efforts on data services and away from voice services, competition in Alestra's core VAS market is and will continue to be stiff in the foreseeable future, placing negative pressure on Alestra's revenues and margins. However, Moody's believes that the company's relationship with AT&T and its robust technological platform somewhat mitigate competition risk. Alestra benefits from its end-to-end network infrastructure, with over 60% of revenues generated on-net. The company owns 3,120 miles of optical fiber, 53 point-to-multi point base stations in the 10.5 GHz spectrum and 3,000+ wireless last mile accesses in 7, 15 and 23 GHz. To date, the company's has invested USD 1 billion in its network.

In addition, a strong customer base, formed mostly of medium and large corporates and high-end residential customers, has supported and should continue to support Alestra's stable and solid EBITDA margins. The strength of its customer base is evidenced by a healthy collection profile and the long-term nature of the vast majority of its sales contracts. Margins also reflect a more profitable product mix, increasingly dependent on VAS as opposed to LD. Moody's believes that Alestra's margins could improve slightly in the medium term if management is able to realize expected savings from its new capital investments. In addition, interconnection costs could decrease further when i) pending decisions from Mexican legal instances on injunctions about tariffs to fixed line and mobile operators are implemented and ii) the dominant state-owned electricity generation utility, CFE, starts offering fiber network for rental. However, foreign exchange risk is a constraint to Alestra's ratings: the company largely relies on its revenues to provide a natural hedge for foreign currency denominated obligations. However, Alestra demonstrated limited ability to increase revenues during late 2008 and early 2009 after a significant devaluation of the Mexican peso.

Pro-forma for the new notes, almost all of the company's debt will be in foreign currency, while 30% of revenues are in foreign currency. The company has pursued a financial hedging strategy in the past to cover 12 months of foreign currency debt service, but does not currently maintain any financial hedges.

Moody's adjusts Alestra's debt to include operating leases as debt and to exclude effects from foreign exchange fluctuations, both of which are Moody's standard adjustments. Since 2006, Alestra's adjusted debt leverage has fluctuated around a moderate level of about 2.5 times EBITDA. Going forward and pro-forma for the proposed notes, Moody's expects that leverage should remain stable at close to 3 times.

From 2004 to 2007, Alestra's free cash flow (FCF) generation had been positive at an average of 12% of total debt. However, higher capex in 2008, aimed at increasing the number of direct accesses as well as improving and expanding its network, reduced FCF generation to 5% of debt. Going forward, however, Moody's expects that Alestra will maintain capex at an average of 16% of revenues, which is considered adequate but should result in limited FCF until 2011. This increases the likelihood that the proposed 5-year notes will need to be refinanced at maturity.

In June 2005, Alestra signed a Cooperation Agreement with AT&T, which expires in June 2010. This is not an exclusivity agreement but describes the working relationship with the local subsidiaries of AT&T's multinational customers. Alestra is AT&T's service provider of choice in Mexico. As of today, about 20% of Alestra's total revenues come from AT&T's multinational customers with operations in Mexico. Because of this agreement, Alestra has a profitable and seamless relationship with AT&T for operation, billing, cross-payments and cross-selling. The agreement renewal process started on June 10, 2009 and Moody's expects it to be completed by year-end.

Alestra's liquidity is adequate pro-forma for the proposed USD 200 million note issuance. Going forward to the end of 2010, Alestra should be able to use EBITDA, cash and proceeds from the proposed notes to repay the 2010 notes, fund capex and fulfill cash obligations such as interest payments, working capital and taxes. In its assessment of Alestra's liquidity, Moody's assumes that the company will continue to refrain from distributing dividends to its shareholders in the medium term and manage its capital expenditures program to maintain sufficient liquidity. The company has substantial headroom under its current debt leverage covenant (incurrence). As is generally the practice for non-financial corporates in Latin America, Alestra does not maintain committed revolving credit facilities. In 2002, Alestra defaulted in its USD 569.7 million global notes due 2002, which in 2003 were restructured with a 15% loss to bondholders.

Because of weak economic fundamentals in Mexico in 2009 and 2010, the stable outlook on Alestra's ratings is based on Moody's expectations that the company's revenues will at least remain stable and operating margins will not experience significant deterioration, with both supported by relatively stable demand from the company's enterprise portfolio. Alestra's resilience is supported by i) its strong customer base focused on the business segment; ii) the long-term nature of its sales contracts; and iii) relatively inelastic business enterprise demand for telecom services, although Alestra may be forced to lower prices in some cases.

The ratings or outlook could be upgraded if Alestra shows solid revenue growth and stable margins, such that adjusted leverage falls back to below 2.5 times (close to 3 times as of LTM ending June 2009, pro-forma for the new notes) and free cash flow generation vis-à-vis debt burden reaches 10%.

The ratings or outlook could be downgraded if weak economic fundamentals in Mexico have a greater than expected impact on Alestra's revenues or margins. Quantitatively, downward pressure would likely result from negative free cash flow of above 10%, causing leverage to increase above 3.5 times.

The last rating action on Alestra was on October 3, 2007, when Moody's upgraded Alestra's ratings to B2 from Ca, which were subsequently withdrawn due to business reasons.

The principal methodology used in rating Alestra was that for Moody's Global Telecommunications Industry, published in December 2007. The methodology can be found at www.moodys.com in the Credit Policy & Methodologies directory, in the Ratings Methodologies subdirectory. Other methodologies and factors that may have been considered in the process of rating this issuer can also be found in the Credit Policy & Methodologies directory.

Alestra, which started operations in 1996, is a local Mexican telecommunications company providing bundled products including voice, data and Internet services. The company is owned 49% by AT&T Telecom Mexico, Inc., a wholly owned subsidiary of AT&T Inc. and 51% by Alfa, S.A.B. de C.V., a major Mexican conglomerate. Alestra's business strategy is focused on offering VAS to its business clients. In addition, Alestra provides wholesale communications services to cable TV and other telecom carriers. Other important customer segments are government entities and offices, call centers and hotel chains. The company also has a legacy base of high-income residential customers with internet access and local telephony services, which total about 10% of the company's revenues. During the last twelve months ending on June 30, 2009, Alestra's revenues and adjusted EBITDA amounted to USD 389 million and USD 131million, respectively.

Mexico City
Nymia C. Almeida
Vice President - Senior Analyst
Corporate Finance Group
Moody's de Mexico S.A. de C.V
Telephone:+52-55-1253-5700

Sao Paulo
Alexander I. Carpenter
Senior Vice President - Regional Credit Officer
Corporate Finance Group
Moody's America Latina Ltda.
55-11-3043-7300

Moody's assigned a (P) B1 rating to Alestra and its proposed global notes. The ratings outlook is stable.
No Related Data.
© 2021 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their licensors and affiliates (collectively, “MOODY’S”). All rights reserved.

CREDIT RATINGS ISSUED BY MOODY'S CREDIT RATINGS AFFILIATES ARE THEIR CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND MATERIALS, PRODUCTS, SERVICES AND INFORMATION PUBLISHED BY MOODY’S (COLLECTIVELY, “PUBLICATIONS”) MAY INCLUDE SUCH CURRENT OPINIONS. MOODY’S DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL FINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT OR IMPAIRMENT. SEE APPLICABLE MOODY’S RATING SYMBOLS AND DEFINITIONS PUBLICATION FOR INFORMATION ON THE TYPES OF CONTRACTUAL FINANCIAL OBLIGATIONS ADDRESSED BY MOODY’S CREDIT RATINGS. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE VOLATILITY. CREDIT RATINGS, NON-CREDIT ASSESSMENTS (“ASSESSMENTS”), AND OTHER OPINIONS INCLUDED IN MOODY’S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT OR HISTORICAL FACT. MOODY’S PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVE MODEL-BASED ESTIMATES OF CREDIT RISK AND RELATED OPINIONS OR COMMENTARY PUBLISHED BY MOODY’S ANALYTICS, INC. AND/OR ITS AFFILIATES. MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS DO NOT COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR. MOODY’S ISSUES ITS CREDIT RATINGS, ASSESSMENTS AND OTHER OPINIONS AND PUBLISHES ITS PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING THAT EACH INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE, HOLDING, OR SALE.

MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS, AND PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS OR PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER.

ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY’S PRIOR WRITTEN CONSENT.

MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT COULD RESULT IN THEM BEING CONSIDERED A BENCHMARK.

All information contained herein is obtained by MOODY’S from sources believed by it to be accurate and reliable. Because of the possibility of human or mechanical error as well as other factors, however, all information contained herein is provided “AS IS” without warranty of any kind. MOODY'S adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when appropriate, independent third-party sources. However, MOODY’S is not an auditor and cannot in every instance independently verify or validate information received in the rating process or in preparing its Publications.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability to any person or entity for any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with the information contained herein or the use of or inability to use any such information, even if MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers is advised in advance of the possibility of such losses or damages, including but not limited to: (a) any loss of present or prospective profits or (b) any loss or damage arising where the relevant financial instrument is not the subject of a particular credit rating assigned by MOODY’S.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability for any direct or compensatory losses or damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud, willful misconduct or any other type of liability that, for the avoidance of doubt, by law cannot be excluded) on the part of, or any contingency within or beyond the control of, MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with the information contained herein or the use of or inability to use any such information.

NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY CREDIT RATING, ASSESSMENT, OTHER OPINION OR INFORMATION IS GIVEN OR MADE BY MOODY’S IN ANY FORM OR MANNER WHATSOEVER.

Moody’s Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody’s Corporation (“MCO”), hereby discloses that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s Investors Service, Inc. have, prior to assignment of any credit rating, agreed to pay to Moody’s Investors Service, Inc. for credit ratings opinions and services rendered by it fees ranging from $1,000 to approximately $5,000,000. MCO and Moody’s Investors Service also maintain policies and procedures to address the independence of Moody’s Investors Service credit ratings and credit rating processes. Information regarding certain affiliations that may exist between directors of MCO and rated entities, and between entities who hold credit ratings from Moody’s Investors Service and have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually at www.moodys.com under the heading “Investor Relations — Corporate Governance — Director and Shareholder Affiliation Policy.”

Additional terms for Australia only: Any publication into Australia of this document is pursuant to the Australian Financial Services License of MOODY’S affiliate, Moody’s Investors Service Pty Limited ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136 972 AFSL 383569 (as applicable). This document is intended to be provided only to “wholesale clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, you represent to MOODY’S that you are, or are accessing the document as a representative of, a “wholesale client” and that neither you nor the entity you represent will directly or indirectly disseminate this document or its contents to “retail clients” within the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is an opinion as to the creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors.

Additional terms for Japan only: Moody's Japan K.K. (“MJKK”) is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’s Overseas Holdings Inc., a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating agency subsidiary of MJKK. MSFJ is not a Nationally Recognized Statistical Rating Organization (“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are assigned by an entity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registered with the Japan Financial Services Agency and their registration numbers are FSA Commissioner (Ratings) No. 2 and 3 respectively.

MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by MJKK or MSFJ (as applicable) have, prior to assignment of any credit rating, agreed to pay to MJKK or MSFJ (as applicable) for credit ratings opinions and services rendered by it fees ranging from JPY125,000 to approximately JPY550,000,000.

MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements.