NEW YORK-Moody’s Investors Service Inc. announced Jan. 22 it may upgrade approximately $5.1 billion in MCI Communications Corp. outstanding debt and preferred stock because of the growing likelihood that MCI and British Telecommunications plc will complete their merger by the end of this year.
Part of the proposed merger agreement is the creation of a new company, Concert PLC, which will own the assets of MCI, based in Washington, and BT, based in London.
“Moody’s believes that Concert will seek to achieve the lowest cost of capital possible for this combination, (and this) may have positive rating ramifications for MCI’s existing debt,” said Moody’s announcement made by Stephen J. Gutkowski, senior credit officer, and Robert H. Ray, managing director, both in the Telecommunications and Media group.
Moody’s said it won’t conclude its review, “until a decision on corporate structure is finalized by the companies.’>
