NEW YORK—Moody’s Investors Service Inc. said Monday it has downgraded about $5.2 billion in L.M. Ericsson debt to Baa3, one tier above junk bond status, from Baa2.
“The rating downgrade is based on a downward revision of Moody’s expected transition cycle for mobile infrastructure equipment, driven by erosion in the market of orders for second-generation wireless systems and additional deferrals of installation plans for third-generation equipment,” said Juergen Berblinger and Wolfgang Draack, Moody’s corporate credit analysts based in Frankfurt , Germany.
Another major telecommunications equipment maker, Motorola Inc., received a debt rating downgrade last Friday. Standard & Poor’s Corp. lowered its rating, which affects about $10 billion in outstanding debt, to BBB, two notches above junk bond or high-yield status, from BBB-plus.
