NEW YORK—Standard & Poor’s Ratings Services assigned its B- corporate credit rating to MetroPCS Communications Inc. and its CCC rating to MetroPCS Wireless Inc.’s $1.1 billion of senior unsecured notes due 2014.
S&P said the company’s outlook is stable.
The ratings firm also said it assigned a B rating to MetroPCS Wireless’ $1.5 billion of first-lien bank loans and a recovery rating of 1, which signals S&P expects investors will fully recover their principal in case of default.
Proceeds from the bank loan and unsecured notes are expected to be used to repay $900 million of secured bank debt and to fund the $1.4 billion purchase of licenses the company picked up in the Federal Communications Commission’s recent spectrum auction.
“The ‘B-‘ corporate credit rating reflects MetroPCS’ inherently challenging business model, which targets a lower-income customer niche, a highly competitive environment, and high leverage,” said Standard & Poor’s credit analyst Catherine Cosentino.
